Preamble

The House met at half-past Two o'clock

PRAYERS

[MADAM SPEAKER in the Chair]

Oral Answers to Questions — NATIONAL HERITAGE

National Lottery

Mr. John Marshall: To ask the Secretary of State for National Heritage what proposals she has to increase the contribution of the national lottery to charities. [4633]

The Secretary of State for National Heritage (Mrs. Virginia Bottomley): The national lottery has exceeded expectations with the huge contribution that it has made to charities. I can today announce that it has raised the magnificent sum of more than £1.3 billion for the good causes fund. More than 3,500 lottery awards, totalling more than £825 million, have been made to projects throughout the country. More than 75 per cent. of all awards made so far have been to charitable or voluntary sector bodies. Today there have been a further 128 awards, including 88 to caring charities in Northern Ireland.

Mr. Marshall: While everyone recognises the great success of the national lottery, does my right hon. Friend accept that there is a feeling about that the director general of Oflot has been guilty of surprising errors of judgment and that too little of the national lottery money goes to genuine charities by comparison with high-falutin' causes, to which there have been too many awards?

Mrs. Bottomley: The distribution of resources from the national lottery has nothing whatever to do with the director general of Oflot. That system was, of course, set up by Parliament. The caring charities have now received 1,409 awards, and that is only the beginning. The lottery has exceeded expectations in the amount of money that it has raised and caring charities have undoubtedly benefited—including Barnardos with £600,000, Arthritis Care with £481,000 and, on Friday, the Pre-School Playgroups Association in Wales with £427,000.

Dr. John Cunningham: Given that the National Lottery etc. Act places on the director general a number of overriding public duties—first, to maximise the net proceeds for distribution from the lottery and, secondly, to secure that the lottery is run with all due propriety—does the Secretary of State think that the director general of Oflot is fulfilling those duties? Is it not time that she laid down a code of practice for the director general and his staff and published it so that anyone can know what

is expected of them? Does she recognise that if she allows Mr. Davis to remain in his post many people across Britain will be astonished?

Mrs. Bottomley: The right hon. Gentleman is correct that the duty of the director general of Oflot is three-fold: to maximise the return for good causes; to ensure that those who play the lottery are protected; and to ensure that the lottery is run with all due propriety. The right hon. Gentleman will be aware of the National Audit Office report, which commended the process of evaluation of applicants for the licence. On that occasion, it described the work of the director general of Oflot in very high terms as being
comprehensive, consistent, logical and properly controlled.
Subsequent events have been discussed at very great length by the Public Accounts Committee last Monday. The right hon. Gentleman and the House will be aware that my Department received a preliminary report from Mr. Davis on those matters. Officials have discussed the subject with him this morning. I need to consider the issues raised carefully. I do not intend to take precipitate action. It would be inappropriate and unfair to say more about the matter today. I shall, however, report to the House in due course.

Mr. Tim Smith: Does my right hon. Friend agree that the NAO report shows that the director general of Oflot evaluated the applications for the licence to run the national lottery in an exemplary manner? Does she also agree that although he may have been guilty of some misjudgment, that is absolutely no reason to demand his resignation?

Mrs. Bottomley: It is my understanding that the National Audit Office clearly said that the director general acted throughout the process in accordance with the statutory duties placed upon him. He has been extremely rigorous and thorough, he has kept detailed notes of all events, and he has been entirely open in discussion with the Public Accounts Committee and with my officials.

Mr. Kaufman: Given the serious potential for corruption that exists as a result of the vast sums of money with which the national lottery is and will continue to be awash, is it not clear that the whole basis of the national lottery as a privatised monopoly is unacceptable? Is it not also clear that when Camelot's licence expires in 2001 the lottery should be operated in the public sector—with the huge profits going to the public and not to private enterprise—and that if elements of the potential for corruption continue, Camelot's licence should be revoked early?

Mrs. Bottomley: The right hon. Gentleman will be aware that the regulatory structure for the lottery was agreed by Parliament. I cannot share the right hon. Gentleman's belief that matters operated by the public sector are necessarily operated more effectively or more efficiently. I am reminded that in the past we subsidised nationalised industries to the tune of £50 million per week. The taxpayer now benefits from the profits of privatised industries to the tune of £50 million per week.
So far as I am aware, our lottery is the most effective and efficient anywhere in the world. With the right hon. Gentleman, I want to ensure that it retains the absolute confidence of all those who participate in it.

Sir Michael Shersby: Does my right hon. Friend agree that we have just seen a remarkable demonstration of the


Labour party's real objection to the whole issue of the lottery—the fact that Camelot makes a profit? Does she further agree that there is not a shred of evidence to show that Mr. Davis acted either corruptly or improperly, and that what we have seen over the past two days has been a disgraceful attempt to impugn the reputation of a distinguished and reputable accountant who has carried out his duties to the full satisfaction of the National Audit Office? Will my right hon. Friend take that into account when she considers the matter?

Mrs. Bottomley: I will indeed note my hon. Friend's comments carefully. I am aware of no suggestions of dishonesty about Mr. Davis. I have heard only that his reputation on professional matters is consistently and highly regarded.

Mr. Alan Williams: It is a week since Mr. Davis indicated in answers that he had taken free trips from a company that he is supposed to be monitoring. The Minister will have been aware of that within hours. Why, a week later, is she is still saying that she cannot make up her mind whether he should go or stay? Most considered opinion is that the man should go—not for dishonesty, but for sheer lack of judgment.

Mrs. Bottomley: It is not my view that a knee-jerk reaction is appropriate in the circumstances. We have an extremely successful and competitive lottery that is highly regarded around the world. I have made it clear that I will report to the House when I have had time to consider the details involved.

Tourist Spending

Mr. Robert Banks: To ask the Secretary of State for National Heritage what analysis she has made of the latest figures on spending by tourists. [4634]

Mrs. Virginia Bottomley: Overseas tourists spent almost £9 billion in the UK up to October—a 13 per cent. increase. Tourism is worth about £36 billion a year—5 per cent. of gross domestic product. There are 88,000 new jobs related to tourism in the year to June.

Mr. Banks: I thank my right hon. Friend for her reply. Does she agree, however, that the United Kingdom and the rest of Europe face a challenge to regain a higher share of the world tourism market? While proposals by the European Commission to raise the profile of tourism are to be applauded, does my right hon. Friend agree that any amendment to the treaty should be scrutinised with great care to ensure that a ceiling is placed on any new department and that regulatory powers are excluded? Does she further agree that regulations such as the social chapter threaten to price the rest of Europe out of the market?

Mrs. Bottomley: My hon. Friend speaks strongly, particularly on behalf of his own constituency, on a subject about which he has great knowledge and he is absolutely right that it is an increasingly competitive world market. We are determined to fight for a greater share of that market because of the potential for wealth creation and job creation. I entirely share my hon. Friend's deep concern that spreading Brussels bureaucracy and European control over such an important industry could do it untold damage. The introduction of the social chapter and the minimum wage would destroy jobs and opportunity in that vital industry.

Mrs. Anne Campbell: Is the Secretary of State aware that one of the most popular forms of tourism in my constituency is that promoted by language schools? Many of them are unregulated and take children as young as 10 and 11 during the summer months, who cause great problems in the city of Cambridge. What is the Minister's attitude to that problem, and what does she intend to do about it?

Mrs. Bottomley: I am well aware that the response of the Labour party to every problem is to tie organisations up in regulation, bureaucracy and licences. I am also aware that the hon. Lady's constituency is a tremendous centre of arts and cultural heritage, and thus has great tourist potential. I am also aware of the huge number of lottery awards that her constituency has been given, which has made it an even greater tourist attraction.
I will look into the issue raised by the hon. Lady in an open-minded way to see whether any sensible approach can properly be taken. I would, however, be extremely reluctant to inhibit the opportunities of language schools, which create a great number of jobs and other opportunities not only in the hon. Lady's constituency but elsewhere.

Sports Facilities, London

Mr. Dykes: To ask the Secretary of State for National Heritage what assessment she has made of the provision of playing fields and similar sports facilities in north-west London; and what policy guidance is given by her Department when local authorities seek to sell such areas. [4635]

The Minister of State, Department of National Heritage (Mr. Iain Sproat): The provision of playing fields and sports facilities in north-west London is a matter for the relevant local authorities to consider, seeking expert advice from bodies such as the Sports Council. The Government's planning policy guidance note No. 17 outlines the factors that local authorities should consider before allowing playing fields to be redeveloped.

Mr. Dykes: My hon. Friend the Minister monitors carefully what is happening to playing fields up and down the country, and I thank him for the work that he has done to ensure that quite a few of them remain in public sector hands. Bearing in mind the fact that the Labour party's official policy document advocates, similarly, that the ownership of playing fields should remain in public hands, is it not preposterous that incompetent Camden council, which has a Labour majority and is one of the worst local authorities in Greater London, is now proposing to dispose of at least two out of its three principal playing fields? Will my hon. Friend make sure that that example of double-standard cynicism is withstood and will he monitor closely what happens if the council foolishly tries to raise excess funds from the sale of those playing fields to outside commercial interests instead of keeping them for the local community?

Mr. Sproat: I thank my hon. Friend for his kind words, and for drawing that matter to my attention in our previous discussions about the important issue of the Prince Edward playing fields. I hope that Camden will continue to allow those playing fields to remain in


existence, because it is an important part of our sports policy that as many playing fields as possible remain open to public access.

Ms Glenda Jackson: Is the Minister aware that Camden council, far from being incompetent, is constantly praised by the Department of the Environment, no less, and is constantly receiving charter marks and recommendations for the excellence of its service? May I further point out that Camden has no plans to sell its playing fields. In fact, it is consulting a range of interested parties, including sports associations and local communities, about them. There is little point in any local authority attempting to maintain its sports facilities, however, if the Government consistently underfund any kind of youth provision. Will the Minister therefore speak to his right hon. Friend the Secretary of State for the Environment about whether there can be a positive change in the Government's approach?

Mr. Sproat: I am glad to hear about Camden council's catalogue of virtues. I hope that they will include making absolutely certain that those playing fields are not sold for development but remain for people to play sport on.

Museums and Galleries

Mr. Spring: To ask the Secretary of State for National Heritage what information she has received on visitor satisfaction in relation to the national museums and galleries. [4638]

Mr. Sproat: The statutory responsibility for managing a national museum or gallery rests with its trustees. However, the information submitted to the Department in the corporate plans of national institutions indicates that the vast majority of visitors are very satisfied with their visits.

Mr. Spring: In assessing quality, will my hon. Friend state how many galleries and museums have been awarded a charter mark? Does my hon. Friend agree that museums and galleries can play a crucial part in highlighting our unique national history? Will he give all encouragement to museums and galleries to publicise our rich history to as wide a circle as possible?

Mr. Sproat: From memory, I can tell my hon. Friend that three museums and galleries have charter marks—the imperial war museum, the Victoria and Albert museum and the national museum of science and industry in Manchester. I congratulate all three on that. As to the second part of my hon. Friend's question, I agree strongly that we would wish to see an increase in the understanding of our national achievements. A review that I am carrying out of museums and galleries will play an important part in increasing that understanding.

Mr. Gunnell: Following action in the Minister's Department, we now have a national coal mining museum in Yorkshire. While visitor satisfaction is high at that museum, there are concerns about the price of admission. Does the Minister accept that it is a part of the role of his Department to ensure that those museums which are supported are within reach of the public who wish to visit them?

Mr. Sproat: The short answer is yes, and I congratulate the hon. Gentleman on the part that he has played in the development of the national coal mining museum. It is a wonderful museum, which I know is currently preparing a

business plan to see how it can get more funds to expand. My Department will do everything within reason to help in that.

Mr. Jacques Arnold: Is it not the quality of our national museums and galleries that attracts so many thousands of visitors from overseas?

Mr. Sproat: Yes—about 60 per cent. of all visitors to the United Kingdom say that visiting museums is one of the key reasons for coming to this country.

Digital Broadcasting

Mr. Hain: To ask the Secretary of State for National Heritage if she will make a statement on the future of digital broadcasting. [4641]

Mrs. Virginia Bottomley: The Broadcasting Bill covers digital terrestrial broadcasting. The framework is designed to stimulate the creation of a fair and competitive market. We want access for new entrants. We aim to safeguard public service broadcasting and the interests of viewers and listeners.

Mr. Hain: The people of Wales will be pleased that there is now an opportunity under the Bill to receive both Channel 4 and S4C. However, the Bill is extremely deficient in at least one other respect: the total failure to address the convergence of telecommunications and broadcasting, especially with digitalisation. Is there not now a very strong, if not unassailable, case for a single regulator for both broadcasting and telecommunications? When I put that point to the Secretary of State's predecessor on 23 May, he said that in principle he was interested in the idea. Seven months later, are not the Government in danger of being overtaken by the rapid growth in this area? For example, NewsCorp has taken a multi-media stake in MCI, 20 per cent. of which is, in turn, owned by British Telecom. Is not this whole area developing very quickly?

Mrs. Bottomley: It is a very exciting area, and I was pleased by the favourable response to the publication of the Bill from almost all the players in the industry. There are huge opportunities for industry, for jobs and for Britain. I am pleased by the hon. Gentleman's comments about Channel 4 and S4C in Wales, and the opportunities which now exist for them. In my view, it is not appropriate at present for Oftel and the Independent Television Commission to merge, as each has an important job to do. However, it is clearly of great importance that they co-operate and the hon. Gentleman will find that, on a number of issues—not only those in the Bill but other matters on which we are about to consult—there is a close and constructive relationship between the two bodies because, as the hon. Gentleman has said, of the importance of the increasingly converging areas.

Mr. Gale: My right hon. Friend is to be congratulated on seeking to ensure through the Bill that the existing terrestrial broadcasters have adequate digital capacity to ensure that they lead the way in the development of new services and new programmes. If my right hon. Friend believes—as she clearly does—that good programming will lead the digital television revolution, is it not time that we freed up Channel 4 from its funding formula and allowed that money to be invested in good new programmes?

Mrs. Bottomley: I believe that there is good news for Channel 4 in my announcement on Friday in that we intend


to ensure that it retains more of the revenue. It must be remembered—I am sure that the House is well aware of this—that the independent television companies pay to the taxpayer about £400 million a year. When thinking about a future funding formula, therefore—which we do not anticipate deciding on before 1997—all the options and the realities of the situation will be reflected on.

Dr. Moonie: In welcoming the right hon. Lady's commitment to full and fair competition, may I ask her why there is nothing about conditional access in the Bill?

Mrs. Bottomley: We are shortly to consult on proposals on conditional access and the consultation will be conducted through the European Communities Act 1972. It is not necessary for it to take place through the Bill. This week, the hon. Gentleman will see the further proposals and the details involved.

Mr. Fabricant: Will my right hon. Friend take this opportunity to congratulate the research and development directorate of the BBC at Kingswood Warren and the research department of NTL in Crawley Court, formerly the privatised arm of the Independent Broadcasting Authority, on their pioneering work in digital broadcasting—both digital audio broadcasting and digital terrestrial television? Will she please liaise with her right hon. Friend the President of the Board of Trade to ensure, as we shall be one of the first broadcasters of digital radio and television in the world, that we make use of the opportunity to be the first exporters of digital television converters and digital audio radio sets?

Mrs. Bottomley: I strongly share my hon. Friend's wish to congratulate all those involved. He mentioned NTL, which bodes well for the privatisation of the BBC transmission services. Incidentally, the hon. Member for Great Grimsby (Mr. Mitchell) was not here to ask his question on that subject. My hon. Friend is right to say that digital technology provides great opportunities for British industry. The Guardian said in an editorial:
If British companies rise to the challenge then it could provide lots of new business not just in Britain, but in the rest of the world, as the ripples of the digital revolution spread …But this time, at least, they can't say the Government didn't try to help.

Mr. Dafis: I welcome the proposals in the Bill for the funding arrangement for S4C and the commitment to link it to the retail prices index. However, does the Secretary of State recognise the need for the base level funding, from which the RPI link will follow, to be sufficiently high to enable the production of the additional programmes that will come through digitalisation and the arrangements now being made? May we also assume that when further frequencies become available as analogue is switched off, or at the first opportunity, S4C will be granted true parity with other service providers?

Mrs. Bottomley: It would be rash for me to make further commitments so far ahead. I believe that the hon. Gentleman acknowledges that we have listened carefully to the concerns of S4C. We have sought to strike a balance between the interests of all those involved in this important industry. I note the hon. Gentleman's points about the basis on which the funding formula is established.

Mr. Stephen: My right hon. Friend will be aware that many hon. Members on both sides are concerned that

digital broadcasters should observe the highest standards of taste and decency. Can my right hon. Gentleman explain why, if the existing codes of conduct are adequate, in April and again in June this year it was possible to screen a film called "Goodfellas", which included stabbings and shootings? In 146 minutes, it contained no fewer than 212 uses of the f-word and on four occasions the f-word was used in conjunction with the word "mother".

Mrs. Bottomley: I will come back to my hon. Friend with detailed comments about the programme that he described. He will know that the introduction of the Broadcasting Standards Council, which combines the strengths of its two predecessor bodies, is intended to ensure that with the greater freedoms that come out of the digital revolution there will also be an enhanced sense of responsibility in the interests of audiences and the public. I am determined that the BSC's work will be strengthened. There will be a requirement to keep a note of the steps that programme makers take as a result of complaints that have been upheld.

Football

Mrs. Bridget Prentice: To ask the Secretary of State for National Heritage if she will bring forward proposals to give football fans more influence in running the game, with special reference to measures to enable more fans to sit on the boards of clubs. [4642]

Mr. Sproat: The administration of sport is a matter for the relevant governing bodies. Decisions on who sits on the boards of football clubs are for the clubs themselves to make.

Mrs. Prentice: Has the Minister had the opportunity yet to read Labour's charter for football, in which we recognise the role of the supporters and their concerns? Is it not time that those supporters, who make such a financial contribution to our national game, should have their concerns heard in the boardroom? Does he agree that it is a welcome development that after discussions I had with the consortium that is bidding for Wembley as the national stadium, the consortium has agreed to look at ways of involving fans in discussions about how the sport can be developed?

Mr. Sproat: I did, alas, have a chance to read the Labour party's charter for football. Having read it, I am not surprised that it has sunk without trace. I have had the pleasure of meeting both supporters' associations, but it remains up to the clubs themselves as to whether they wish to have members of those organisations or, for that matter, any other organisations, on their boards. They are perfectly free to do so if they wish.

Mr. Hawkins: When considering the concerns of legitimate football fans in looking forward to Euro '96 in this country next year, will my hon. Friend pay special attention to the need for liaison with the police—and especially with the football fans intelligence unit in the national criminal intelligence service—to ensure that the hundreds of thousands of legitimate fans do not have their pleasure, and public order, spoilt by the small minority of mindless hooligans who have besmirched Britain's reputation in the past? While we look forward to a successful Euro '96 tournament, will my hon. Friend join me in wishing the England and Scotland teams success against Holland and Switzerland?

Mr. Sproat: I certainly join my hon. Friend in wishing the best to Scotland and England. We have taken all the


measures that we think fit to keep hooligans out. For instance, if we know of people with records of football trouble arriving at a port, we have the power to ban their entry. If they are caught offending in a British football ground, they will be taken before the courts and they can be released on a bail that will prevent them from attending any other football matches in June next year.

Mr. Tony Banks: The board of Chelsea football club would have been a rather dangerous place to put anyone on, given the arguments between Ken Bates and Matthew Harding in recent months—a UN peacekeeping force might have been more appropriate—although they have now kissed and made up. Would it not be appropriate to consider a charter for football supporters as they are so often treated as a necessary evil in grounds and many rights have been and are infringed both in and outside grounds? A football charter might be appropriate for the 1996 European championships.

Mr. Sproat: No, I do not agree. It is true that hooliganism has been falling and attendances at grounds rising, although some problems remain and it is up to the clubs themselves to sort them out. I pay special tribute to what has been done by the Football Association, the Premier division and the Football League in sorting those problems out. A great deal of praise ought to be directed at them.

Mr. Simon Coombs: Is my hon. Friend aware that forward-looking clubs such as Swindon Town have already established shadow boards and take every opportunity to involve responsible fans to the fullest possible extent? That is no doubt the reason why Swindon Town stands at the top of the second division. Can my hon. Friend think of any other idea advanced recently that is sillier than that proposed by the Opposition?

Mr. Sproat: Not easily, in the time that it takes me to get from the Bench to the Dispatch Box. I agree with my hon. Friend. Nothing in the football charter that was new was sensible, and nothing that was sensible was new. I am sure that Swindon Town football club is right to involve the fans as much as is proper, which is exactly what the fans want most.

Mr. Pendry: Is the Minister aware that my hon. Friend the Member for Lewisham, East (Mrs. Prentice) is right: a host of issues currently concerns football fans, including sharply rising admission charges, inadequate facilities for away supporters and the lack of discount schemes for the young, the unemployed and the disabled. We recognise that no Government should dictate to those who run sport, but will the Minister join all the football authorities—the Football Association, the premiership, the Football League, the players' union and many others—in endorsing the proposals contained in Labour's charter for football, which will ensure that spectators are given proper representation on bodies in which they have an interest? Far from sinking without trace, we must now reprint many more thousands of copies of that document to meet demand.

Mr. Sproat: I cannot believe that any football ground would welcome being told by a future Labour Government, if such a thing should come to pass, what admission prices it should charge. We all know that football has many difficulties, such as the taking of drugs and bungs, with which the proper authorities—the Inland Revenue and the police—are dealing. The last thing that

football wants is a couple of Labour politicians on so-called "task forces" sticking their noses in and telling football what it must do.

Arts Funding

Lady Olga Maitland: To ask the Secretary of State for National Heritage what assessment she has made of the effects of the overall funding provision for national heritage, with special reference to the arts. [4643]

Mr. Sproat: The areas covered by my Department are being funded on an unprecedented scale. The lottery has increased the amount available for the arts by some £224 million, more than doubling the amount provided previously.

Lady Olga Maitland: I thank my hon. Friend for the excellent news. The arts have done extremely well. Not only does the Arts Council provide £186 million but the national lottery provides nearly £200 million. Will my hon. Friend deal with the problem of donations to the arts from the national lottery? The arts can receive money for capital costs but not for revenue costs, so an orchestra can receive resources for a trombone but not funding for the conductor.

Mr. Sproat: My hon. Friend is right. As well as the £186 million which the Arts Council of England will receive—there are other grants for Scotland, Wales and Northern Ireland—local authorities pour millions of pounds into the arts, as does the national lottery. My hon. Friend makes an important point about revenue costs which many people in the arts and sport would like to see resolved. My right hon. Friend and I are looking at how the lottery spends its money to see what can be done.

Mr. Cohen: May I suggest that the Minister view the annual London lecture given by Jeremy Isaacs of the Royal Opera house and broadcast on Carlton television yesterday? Mr. Isaacs said that, because of a shortage of public funds for the arts in London, standards were beginning to slip. Will the Minister start to put some funds back into the arts in London?

Mr. Sproat: Of all the people who could complain about arts funding in London, the man who has just received some £55 million for the Royal Opera house is hardly the one to do it. As my hon. Friend the Member for Sutton and Cheam (Lady Olga Maitland) said, we are putting £186 million into the Arts Council, and more than £200 million will go to the arts through the national lottery. We are also putting money into the arts through local councils. So the arts, which receive almost £700 million a year in London and elsewhere, do not have too much cause for complaint.

Mr. Jessel: Should not the tickets purchased by audiences be regarded as part of overall arts funding? As last month the Chancellor of the Exchequer announced £3 billion extra in purchasing power in people's pockets, why do not the arts bodies set out to attract a substantial part of that increase, which is 600 times as large as the marginal cut in the Arts Council's budget?

Mr. Sproat: My hon. Friend's question is as sensible as his playing the other day at that concert was marvellous. No one who heard him as the soloist in Schumann's piano concerto will forget it. He was wonderful. What he says is right.


Perhaps I may take the opportunity to say that it is not only a matter of tickets; sponsorship by business of the arts is about £82 million this year, which is not a bad contribution.

Millennium Exhibition

Mr. Spearing: To ask the Secretary of State for National Heritage when she expects to announce the identities of the operators chosen to run the millennium exhibition. [4644]

Mrs. Virginia Bottomley: My colleagues on the Millennium Commission and I expect to announce the preferred site and operator combinations for the millennium exhibition in late January 1996.

Mr. Spearing: Will the Secretary of State confirm that the Millennium Commission will choose an operator on the basis of the commissioners' ideas for the content of the exhibition and the continuing heritage benefits to the site or sites on the shortlist? Would it not be better for the commissioners to consider all the options available, choose the best combination of them, obtain a few more ideas from the public or from public organisations and make the final decision on the basis of that mixture? Would that not be a more sensible way of going about obtaining the type of millennium exhibition that we all want, and hope will be a success?

Mrs. Bottomley: The hon. Gentleman will be aware that there is a timetable for planning for that great celebration, and we need to make progress and bring the uncertainty to an end. He will recall that it was Ethelred the Unready who presided over the last millennium. Enormous care has gone into seeking sites, short-listing sites and inviting bids from different operators. The Millennium Commission is aware of the seriousness of that task and of the enormous potential of all the sites under consideration. I will indeed ensure that my fellow millennium commissioners are aware of the anxieties expressed by the hon. Gentleman.

Mr. Butcher: My right hon. Friend will recall that, in the strict meaning of the Saxon description of Ethelred the Unready, he was the unraed, meaning the ill-advised. I hope that my right hon. Friend feels that she would be ill-advised if London were to dominate the millennium celebrations in the edifices built or events put on. In the midlands, at the national exhibition centre, there is a site with perfect communications, which happens to be only three miles from the monument that marks the centre of middle England.
I wish our colleagues in Ulster, Scotland and Wales great success with their excellent projects, but, as for England, will my right hon. Friend focus resources and attention on the national exhibition centre site?

Mrs. Bottomley: My hon. Friend, with his great learning, must be aware that Birmingham has had many lottery awards from the different distributors already. He is correct, however, in saying that the national exhibition centre is a perfect site for a millennium festival, as are the east London meridian site in Stratford, the Greenwich site and, indeed, the Derby site at the heart of the nation.
The difficulty for the millennium commissioners is that, each time we have visited all four sites, we have been caught up in the enthusiasm of people hoping that they

will be able to hold the reception there. We are determined, however, that that will be a festival of tremendous significance, celebrating the achievements, ability and potential of our nation as we move into the new millennium. We all take the choice of site extremely seriously.

National Lottery

Mr. Pope: To ask the Secretary of State for National Heritage what plans she has to make changes in the distribution of funds from the national lottery. [4645]

Mrs. Virginia Bottomley: The national lottery is a great success. I am prepared to consider modifications to build on that success. Specifically, I am keen to ensure that the funds that it produces are used to maximise the range of facilities and the number of opportunities for people throughout the country.

Mr. Pope: Will the Secretary of State review the operation of the millennium fund? The minimum grant of £100,000 effectively disfranchises many small towns and organisations from bidding for projects. What is the point in having funding for projects of local significance when, in many parts of the country, the effect of the £100,000 threshold is that many smaller organisations cannot bid?

Mrs. Bottomley: The hon. Gentleman is aware that the Millennium Commission has a minimum award of £100,000, but many of its projects are umbrella projects which bring together smaller schemes. The groundwork trust projects, the millennium forests and the 2,500 miles of cycle track affect and serve many parts of the country. The other distributing bodies make much smaller grants. That is the view of the Millennium Commission to date, but I shall discuss with my fellow commissioners whether we should modify the rule in the near future.
Finally, the Millennium Commission is consulting on millennium awards and a way of investing in people as well as in capital. I hope that the hon. Gentleman and other hon. Members will ensure that organisations which they think could take up the opportunity respond to the consultation process.

Mr. John Greenway: Will my right hon. Friend consider altering the rules to allow lottery funds to support regional opera productions? Lottery funding supports film productions, but not opera productions. It is difficult to see how some regional opera houses— particularly touring opera productionshouses—will benefit from lottery distribution that is only for capital expenditure. Touring opera companies visit many theatres throughout the midlands and the north of England in particular, and sponsoring opera production would assist many regional companies to expand their programmes and their audience appeal.

Mrs. Bottomley: It is only early days for the national lottery. The rules established for the early phase have been in operation for only 10 months and we did not start making awards until last March. It is quite remarkable that 3,530 awards have been made during that time, including 638 in the arts field.
I am having discussions with the chairman of the Arts Council and the other distributing bodies on whether we could introduce sensible modifications to make the lottery even more successful. I am mindful of my hon. Friend's comments that funding for the arts is a partnership


process. Business and local authority sponsorship, the contribution that people make through the box office, taxpayers' contributions and the lottery awards must make sense as a coherent whole.

Oral Answers to Questions — LORD CHANCELLOR'S DEPARTMENT

Court of Appeal

Mr. Mudie: To ask the Parliamentary Secretary, Lord Chancellor's Department what is the average notice given for Court of Appeal hearings. [4663]

The Parliamentary Secretary, Lord Chancellor's Department (Mr. Jonathan Evans): Cases in the Court of Appeal are dealt with individually and the period of notice depends upon the circumstances and the urgency of the case. The convenience of the parties is taken into account as far as is practicable.

Mr. Mudie: The Minister will be aware that fewer than five days' notice is given for many cases that are heard in the criminal division of the Court of Appeal. He will also be aware that, as a result of that short notice, too many people facing imprisonment have their cases heard without sufficient time to obtain any professional legal representation. Does the Minister agree that that is a totally unacceptable way of dispensing justice? Will he inform the House what steps he will take to ensure that individuals facing an appeal or possible imprisonment have sufficient time to arrange their representation?

Mr. Evans: I am rather surprised to hear the hon. Gentleman complain about the speed of justice in the criminal division of the Appeal Court, as it is more usual to hear complaints about delays in justice in the civil division of that court. I know that the Master of the Rolls pays great attention to that problem and the Government have sought to resolve it by providing more judges.
In the context of appearances before the criminal division, the Government generally believe that justice should proceed speedily, but I am happy to examine any circumstances in which it is claimed that it has been dispensed so speedily that justice has been denied. However, I am very surprised to hear a complaint that appeal hearings are occurring too quickly; I usually hear complaints to the contrary.

Mr. Alex Carlile: In welcoming the hon. Gentleman to his new ministerial appointment, I ask him to consider allowing further hearings of the Court of Appeal criminal division to take place in the regions. He knows that the court has sat in Cardiff in the past. I suspecthouses—I urge this view on himhouses—that the process could be more speedy if hearings were to take place in places such as Cardiff and Manchester.

Mr. Evans: I thank the hon. and learned Gentleman for his welcome, which he delivered with characteristic sincerity and generosity. I am very much aware of the experience of the criminal division of the Court of Appeal sitting in Cardiff. As the hon. and learned Gentleman will know, I was in practice in that city at the time and I was concerned with one of the cases that came before the court. Since taking up my present appointment, I have considered that possibility. The advice I have received so far is that it is not likely to lead to speedier justice, and may even create a delay. However, I shall continue to

keep the matter under review. If the particular difficulties that have been highlighted can be overcome, we should work towards the Court of Appeal sitting in other parts of the country from time to time.

Sir Ivan Lawrence: I welcome the speed of cases reaching the Court of Appeal, but is not one of the major reasons why cases are not reaching the civil division of the Court of Appeal that too many judges are now preoccupied with judicial review? Is that not causing a problem with the judiciary that will shortly become a problem for anyone running a Department that is challenged at every turn by a number of judicial reviews? Is it not time that close attention was paid not to abolishing judicial reviews, which fulfil a necessary and important function, but to curbing some of the enthusiasm that is grinding into the ground the operation of Government and the courts?

Mr. Evans: I have noted my hon. and learned Friend's views on the operation of the judicial review, but it is primarily the work load in the civil courts that has led to such a substantial increase. I have discerned an increase of some 61 per cent. in the work load of the civil division of the Court of Appeal since 1991. Furthermore, more judges have been appointed. Since 1993, we have had five additional Appeal Court judges, but that has not made a significant contribution towards reducing the backlog, which is increasing.
The Government have taken additional steps. My hon. and learned Friend probably knows that fixed time limits have been introduced in respect of oral arguments in the civil division of the court. I am sure that hon. and learned Members will be delighted to learn that lawyers have been taken on to ensure that appeals that reach the civil division are ready. It is totally unacceptable for a case to come before the civil division of the Court of Appeal with some requisite paperwork missing so that the hearing has to be aborted.

Legal Aid

Mr. William O'Brien: To ask the Parliamentary Secretary, Lord Chancellor's Department what recent representations he has received in respect of the reform of legal aid. [4665]

Mr. Jonathan Evans: More than 180 responses to the Lord Chancellor's Green Paper have been received from a wide range of interested parties, including the legal profession and consumer bodies. Their comments and suggestions are being analysed and a series of meetings with some of the major respondents has been taking place.

Mr. O'Brien: When considering any reforms of the legal aid service, will the Minister have regard to balancing claims for civil action and claims for criminal action? Money is being spent on defending people who have offended against society rather than on those who have been offended against by society. In my constituency, many people wish to apply for legal aid to defend themselves against actions by quangos such as the health service and those employed by those quangos, or by private companies, but they are denied that opportunity because of the lack of resources.
Will the Minister ensure that any reforms undertaken help to balance the position and help people who have been offended against by society? Will he also consider


allowing specialist views to be obtained by people who have a housing or health grievance or who are victims of crime? There should be more balance to help innocent people who wish to pursue a claim through the courts.

Mr. Evans: The hon. Gentleman should note that the Green Paper that is the source of the consultation exercise is entitled "Legal Aidhouses—Targeting Need". That is primarily the focus of the exercise. We are seeking to ensure access to legal services within an affordable legal aid budget.
May I take issue with one remark by the hon. Gentleman? He suggested that there was a lack of resources. Surely he is aware that the legal aid budget has more than quadrupled in the past 10 years. Expenditure on legal aid is 14 times higher than when the Labour party was last in office. In those circumstances, there is no question of there being a lack of resources; it is a matter of ensuring that resources are targeted correctly, and that is what the consultation exercise is all about.

Sir Anthony Grant: In considering any reform of the legal system, will my hon. Friend bear in mind, first, that there is far too much litigation? We do not want to become like the United States, which is rapidly turning into a lawyers' paradise. Secondly, will my hon. Friend bear in mind the increasing injustice being done to people who are just above the limit for legal aid but not necessarily well off, who can be blackmailed by those receiving legal aid?

Mr. Evans: Let me deal with my hon. Friend's second point first. He is absolutely right, and, as he will know, that very point is highlighted in the Lord Chancellor's consultation document. It has been the subject of public concern, and has also been raised by many hon. Members. We must examine ways of dealing with the difficulty.
As for my hon. Friend's substantive point, it is also important for us to find alternative ways of resolving disputes. My hon. Friend will be delighted to learn that the Lord Chancellor's Department hopes to publish, early in the new year, a document outlining the alternative forms of dispute resolution. We hope to devote considerable attention to that document. Although we shall always need the courts, and a structure allowing disputes to be resolved in that final venue, anything that we can do in the meantime to end disputes on the basis of keeping legal costs to a minimum and enabling the issues to be distilled into just a small number of issues must be worth while.

Mrs. Dunwoody: If the Minister wishes to keep legal aid costs down, will he undertake a detailed examination of the number of cases in which, after a legal aid certificate has been granted, no actionhouses—or very little actionhouses—is taken by the legal firm concerned for at least 12 months? Will he consider the effect of that on the overall costs of legal aidhouses—quite apart from the fact that it does not deliver an adequate system of justice to those of our constituents who need it most?

Mr. Evans: I am sure that the hon. Lady will be aware that all legal practitioners have a professional duty to ensure that they deal with cases with due diligence. As one who was in practice, however, I recognise that in a number of cases practitioners may fall short of fulfilling that duty. If the hon. Lady knows of such instances, they

should be drawn to the attention of the professional bodies concerned.

Family Law Bill

Lady Olga Maitland: To ask the Parliamentary Secretary, Lord Chancellor's Department what representations he has had with respect to the Family Law Bill. [4666]

Mr. Jonathan Evans: I have received a number of representations, including representations from my hon. Friend, in relation to the proposals contained in the Family Law Bill. I am also aware that my hon. Friend has been to see my right hon. and learned Friend the Lord Chancellor, and I trust that she was reassured by what he had to say.

Lady Olga Maitland: I thank my hon. Friend for his reply, but I was not reassured by what the Lord Chancellor had to say to me. Is my hon. Friend aware that there is grave disquiet throughout the country about the Family Law Bill, which will hasten the break-up of marriages? The victims of such break-ups are undoubtedly the children: children of broken marriages are more likely to turn to crime and subsequently to carry knives. Surely my hon. Friend agrees that we must do all that we can to enhance marriage.

Mr. Evans: I am disappointed to learn that my hon. Friend has not been reassured to date. I look forward to ensuring that she is reassured during the months ahead. Let me also tell her that it is not the existence of legislation to deal with instances of marital breakdown that causes such breakdowns; sadly, marital breakdown is a fact of life in our society. I entirely agree with her about the effect on children. She will know that that has been one of my main interests since I have been in the House and before. It is very important that we recognise that perpetuating a system that is based on conflict does nothing in the circumstance to help the position of children.

Mr. Boateng: The Minister is welcome to his place. He has been bloodied by his friend the hon. Member for Sutton and Cheam (Lady Olga Maitland). Let us hope that he is unbowed, at least on this issue. Will he give the House an assurance that the Family Law Bill has been properly costed and that there are funds available for a comprehensive mediation service? If such a service is not in place, we shall not be able to give families the support that they deserve and would have another example of the Government wishing the end without willing the means.

Mr. Evans: I thank the hon. Gentleman for his welcome and I welcome him to the Dispatch Box.
The Family Law Bill rightly places an important emphasis on mediation, but it also does something that I hoped would be welcomed by the Opposition: it showsthat the Government have not set out the precise framework in which that mediation is to be offered. We are prepared to take that forward on a pilot basis. I reiterate that assurance to the House today.

Madam Speaker: Thank you. We have made very poor progress in the past hour. I hope that, after Christmas, questions will be much brisker and exchanges much swifter across the Floor of the House. Progress today has not been very good at all.

Madrid Summit

The Prime Minister (Mr. John Major): With permission, Madam Speaker, I shall make a statement on the meeting of the European Council at Madrid, which I attended with my right hon. and learned Friends the Foreign Secretary and the Chancellor of the Exchequer. I have placed the conclusions of the Council in the Library.
I shall deal first with economic and monetary union and then with enlargementhouses—the two most important matters discussed over the weekend.
The decisions that the European Union must take on those two issues over the next few years could be the most crucial steps for Europe since the European Community was founded. They will have a profound effect on the political and economic stability of our continent over the next generation.
On economic and monetary union, the Madrid Council decided on a name for the single European currency. "Euro" was not a name that attracted universal enthusiasm around the Council table; it will not ease the task of those seeking to market the idea of a single currency, but one or more of the member states had rooted objections to each of the other names suggested.
A more fundamental decision was to study the implications of seeking to introduce a single currency in 1999. As the House knows, I have for a long time argued that the introduction of a single currency by a small minority of states would raise very serious questions about its economic consequences and about the way in which Europe functions. At the informal meeting in Majorca in September, there was general agreement that those questions needed to be examined carefully. At Madrid, a study was formally commissioned.
The Maastricht treaty lays down strict criteria for entry to a single currency. It is now certain that, on a proper interpretation of the criteria, only a small number of member states will meet them if a single currency is introduced in January 1999. Before taking such a step, the European Union needs to consider what it would mean in practice. It must consider its effect on the states outside the single currency area, as well as those inside it. It must consider how decisions would be taken. It must ask whether the result would be divergence rather than convergence of European economies. It must consider the potential effects on employment and the demand for resource transfers. The risk of monetary instability is one of the questions to be examined.
Some have argued for rigid linkages between those inside and those outside a single currency, by reverting to an old-style exchange rate mechanism. That is a course that has been tried and has failed. I have made it clear to our partners that I would not recommend that sterling should return to such a system.
Europe needs coherent answers to those and other questions, and I am glad that the Madrid Council decided to examine them. The opt-out that I negotiated at Maastricht protects the United Kingdom from being forced into an unworkable system, but it is vital to our interests and to the interests of Europe as a whole that a single currency does not begin and then fail, thus causing economic turmoil right across the European continent.
I now refer to enlargement. Ahead even of prosperity, the European Union exists to provide security and stability for the peoples of Europe. For that reason, I believe that enlargement is the most important task facing the European Union. Having demolished the iron curtain, we must never again have a dividing line running through the middle of Europe.
Ten or more countries are hoping to negotiate entry to the European Union in the coming years. This is an historic opportunity to entrench stability through a union of democracies right across the continent, and one that I passionately believe we must take. The Madrid Council gave further impetus to enlargement. The European Commission has been asked to produce opinions on all eastern and central European applicants as soon as possible after the end of the intergovernmental conference. That is a necessary step towards full accession negotiations, which are likely to begin with at least the most advanced of the new applicants, as well as with Malta and Cyprus, in about two years' time.
The Madrid Council considered reports from the Commission on the implications of enlargement for the European Union's policies, and those are profound. To be affordable and to be consistent with the EU's obligations under the general agreement on tariffs and trade, the common agricultural policy will have to be reformed when the Union enlarges, and so will the structural and the cohesion funds. At my insistence, it was agreed that future meetings of the Council would examine the implications. The Madrid Council has therefore taken an important step towards combining policy reform with enlargement, both of which are essential to the European Union's future.
I shall deal briefly with some of the other subjects that were discussed at Madrid. It was agreed that the intergovernmental conference would start at Turin on 29 March. The conference will be conducted by meetings of Foreign Ministers supported by a working party made up of a representative of each Minister and of the President of the European Commission. No decisions were taken at Madrid on the substance of the intergovernmental conference. Work on the agenda will be carried out under the Italian presidency by Foreign Ministers.
The drive to promote subsidiarity was again strongly in evidence at Madrid and was vigorously supported in informal discussion. The Commission has been instructed to examine the continued need for existing Community legislation and for proposals that are now on the table. It is now widely recognised that the United Kingdom was right to reverse the trend towards greater intrusiveness by the Commission. There was also support for our approach to job creation, flexible pay relating to performance, the curtailing of non-wage labour costs and the reform of social protection systems. Increasing emphasis is being given to small and medium-sized enterprises and to the need to cut the burden of red tape and over-regulation.
The campaign against fraud and for better financial management, which I launched at the Essen Council a year ago, gained further weight at Madrid. The House will welcome the higher priority that is being given to intergovernmental co-operation against drug trafficking. At Madrid I presented, with President Chirac, an initiative to help Caribbean states to crack down on the trans-shipment to Europe and elsewhere of huge quantities of drugs that are produced in Latin America. That initiative was agreed by the Council and is now part of the European Union's policy.


On external affairs, the Council underlined the importance of successful implementation of the Bosnian peace agreement and gave support to Mr. Carl Bildt, who will be there leading the international civilian effort. It also discussed the European Union's relations with Russia, Ukraine and Turkey and welcomed the agreement at the recent European Union/United States summit to strengthen the relationship with the United States.
At the Council, the key decisions for the future were identified rather than taken. The programme of work for the next five years, the "Political Agenda for Europe", is set out in the Madrid conclusions. It is a formidable programme. In that period Europe must review the treaty at the intergovernmental conference; review the Union's policies, including the common agricultural policy and the structural funds; take decisions on a single currency; carry out enlargement negotiations; determine the Community's future financing; contribute to new European security arrangements; and develop its relations with neighbouring countries, especially Russia, Ukraine, Turkey and other Mediterranean countries. The decisions that we take in that period will determine the shape of Europe well into the next century. They will vitally affect the United Kingdom's interests and our future security and prosperity. That is why, at successive meetings of Heads of Government, I have argued for cautious and careful consideration before decisions are finalised.
The European Union must carefully weigh the practical consequences of all those issues. Its decisions must be securely grounded in reality. We need, above all, a Europe that works. In that respect, important steps were taken at Madrid, as they were at Majorca a few months ago. They would not have been taken if we had not been prepared to raise the difficult questions and to demand practical answers to real problems. In the interests of the United Kingdom, it is essential to continue taking a hard-headed approach at the centre of European policy making, and I intend to go on doing so.

Mr. Tony Blair: May I thank the Prime Minister for his statement? There are several areas with which we can obviously agree.
On enlargement, I warmly welcome the European Council's commitment to begin negotiations at an early date. Will the Prime Minister clarify whether those negotiations will indeed begin at the same time as negotiations with Cyprus and Malta? Will he also tell us how the European Union intends to differentiate between countries that will enter more rapidly, such as Hungary, the Czech Republic and Poland, and the others that will take more time? I agree totally with what he says on the common agricultural policy, but instead of using the need to reform the CAP as an excuse to delay the entry of those countries into the European Union, should not we rather be using enlargement as the lever for changing the CAP?
I welcome the agreement at the Council to open the intergovernmental conference in March next year. I also welcome the agreement on the importance of the European Union tackling unemployment as
its principal social, economic and political objective",
as well as the strongly expressed support in the President's conclusions for social partnership and job creation measures. However, how is such support for

job creation measures and for help for the unemployed consistent with the savage cuts in the training in work programmes for the unemployed in this country today?
I accept and agree with the Council's decision to take more effective action on racismhouses—the Ministers all committed themselves to taking further action on that issue. Will the Prime Minister perhaps tell us what further action he believes we should take here? I also welcome the progress towards implementing the principle of subsidiarity in European law making at the Council, but how can he agree so much with the principle of subsidiarity in Europe and deny it so completely here at home in the United Kingdom?
May I come to the heart of the matter, which is monetary union? Can we be clear on that which has now been agreed unanimously by the European Council: that the Maastricht timetable stands, that the third and final stage of monetary union should begin on 1 January 1999, that all the criteria for convergence, for the setting up of the European central bank and for the fixing of currency conversion rates have been reaffirmed; and that the Prime Minister has agreed to it all in Madrid, despite his objections?
Why then has the Prime Minister been so utterly powerless in this situation? Whatever happened to those great new alliances that we kept reading he built with the French, his triumphal visit to Italy, and his constant claims that the rest of Europe was coming round to his way of thinking? Why was he driven to concealing his impotence with the fig leaf of some study into the effect of the single currency, which was so threadbare as to be an embarrassment to behold? May I tell him why? It is because no one knows what his position on monetary union is. [HON. MEMBERS: "Oh!"] Conservative Members criticise us for our positionhouses—[Interruption.] They cannot have it both ways. They spend half the time criticising us for having a position on the single currency and the other half criticising us for not having one.
Can the Prime Minister tell us whether he still believes in monetary union, as he used to say he did? Does he want to delay it or does he in fact want to abandon it? Are his hesitations about a single currency those of economic practicality or are they those of constitutional principles?
We do not know what the Government's position is. We do not know because one half of his party believes, as we do, that it depends on Britain's nationalhouses—[HON. MEMBERS: "What about the Labour party?"] I am saying what our position is. Our position is, like that of some members of the Prime Minister's party, such as the Chancellor, that it depends on national economic interests. The other part of his party, however, believes that there is an insuperable constitutional objection to monetary union. But what is the Prime Minister's position? We have made our position clear: what is his position?
Is not it the case that the divisions between those Conservative Members who believe one thing and those who believe another are so deep that they consign the Prime Minister perpetually to weakness and indecision on the very issue that matters? Is the Chancellor right, for example, in saying that it is 60:40 likely that there will be currency union? Does he agree with that or not? Is the Chancellor right in saying that we may have to decide by March 1998 whether we shall aim at joining?
Is the Prime Minister seriously going to go into an election not telling us where he stands on the issue of constitutional principle? Is he going to tell us or not? Is he


going to be driven to a referendum despite his earlier rejection of it and despite the fact that his Chancellor described it as madhouses—not as a way of letting the British people decide, but as a way of letting the Conservatives avoid deciding the issue of principle? If that is what he is going for, as the papers have been briefed, is it credible that the Cabinethouses—with one half siding with the Chancellor and the other half with the Defence Secretaryhouses—could ever put a united proposition on joining the single currency to the British people? [Interruption.] Some Conservative Members are shouting out that we are the poodles of Europe, and others are saying that we have not made up our minds. The fact is that we have a position set out and the Prime Minister does not. Until he is prepared to say personally what his position is, they cannot resolve the impasse.
For too long, is not it the case that Government policy has proceeded on the fantasy that the rest of Europe was not actually going to proceed with monetary union? Of course it may still not happen, but we can no longer assume that it is not going to happen. Indeed, after Madrid, we should surely assume the opposite. I put it to the Prime Minister that it is simply no longer tolerable that, because of the divisions in the Conservative party, a proper national debate on the single currency is postponed, the Cabinet muzzled and the Chancellor sworn to silence on an issue that profoundly affects the future of this country.
Is not it time for a serious and well-informed national debate to begin? The Government's European policy after Madrid is still in tatters and uncertain. Rebuilding that policy is essential for Britain's credibility. To rebuild it, we must have the debate on this issue that has been suppressed for too long, and time is running out.

The Prime Minister: I shall first touch on the points on which I am in agreement with the right hon. Gentleman. I, too, as he acknowledged, am in favour of enlargement. On the timing of enlargement, as I said in the statement, a small number of stateshouses—and in answer to his particular question, that will depend on the Commission's opinion, which will largely be based on economic criteria, so it is an unknown numberhouses—will begin negotiations at the same time as Cyprus and Malta. The matter of which ones they are will depend on the detailed examination of their economies, which will take place immediately.
On the common agricultural policy, I am of course doing precisely what the right hon. Gentleman asked me to do over using enlargement as a lever for changehouses—which we have long argued is necessaryhouses—and reform, to which a number of Labour Members are late converts.
Of course unemployment is important. Much of the debate on unemployment was concerned with the need for deregulatory moves and for cutting down the costs that have led to so much unemployment across Europe. What was signally missing from the right hon. Gentleman's tirade was an acknowledgment that it is here, in this country, that unemployment is falling, and that it is in the socialist countries of Europe that unemployment is in some cases well over 20 per cent., and in other cases 12 or 13 per cent., where non-socialist Governments have inherited the effect of socialist Governments.
There was no substantive discussion among Heads of Government on racism. There had been discussion at an earlier stage. There is general agreement that where there are loopholes in legislation across Europe, individual

countries will seek to deal with them. The loophole that arises with the United Kingdom is over the fact that it is possible to print racist material here. It cannot be distributed here, but it could conceivably be printed here for distribution abroad. Clearly, that is a loophole that we would wish to block and I have indicated that we will certainly block that. There are some minor technical issues still being worked out, but I do not envisage that they will cause any great difficulties. They will be examined.
The points about subsidiarity are familiar. We have debated them on many occasions in the past. We are a single nation state. The point about subsidiarity is taking authority from nation states to a central body, not the distribution of authority within a nation state.
On economic and monetary union, the right hon. Gentleman is certainly correct to say that we reiterated the treaty timetable. The treaty timetable was originally in the Maastricht treaty. For those who are able to meet ithouses—that is an unknown and probably small numberhouses—it has again been reiterated.
The right hon. Gentleman had something to say about divisions. He was not of course as clear as he might have been about his own position. Does he agree with the deputy leader of the Labour party, who again was in Europe making mischief on other matters over the weekend? Does he agree with the right hon. Member for Kingston upon Hull, East (Mr. Prescott), who said of a single currency,
Yes we are against a single currency"?
Or does he agree with the right hon. Member for Copeland (Dr. Cunningham), who said that he was
Personally…in favour of a single currency"?
Does he agree with his Members of the European Parliament, who are in favour of a single currency within the time limits and timetable, or with the hon. Member for Livingston (Mr. Cook), who said some time ago that setting such a timetable would be "irresponsible"?
It is good to see that there is such clear-cut agreement and leadership in the Labour party on that vital issue. If the right hon. Gentleman had observed the faces behind him, I do not think that he would have said much about agreement in the Labour party. I seem to recall reading recently that one third of the Labour party is in favour of a single currency, one third is against, and one third of them have not yet made up their minds or do not know. That is the right hon. Gentleman's idea of agreement on that extremely difficult and complex position.
I have made it perfectly clear on a number of occasions that there are questions about a single currency that are vital to this country's interests, which are not yet known. It is the answers to those questions that I have demanded are examined in the European Union. If the right hon. Gentleman wants to make up his mind on the most important single economic issue that we have faced this century without the facts, let him take that position in this great national debatehouses—although if he is entering into a great national debate, he might make up his own mind what his own position is before he tries to debate with anybody else. Those are issues of immense importance. We will demand that they are properly discussed so that a proper decision can be taken in the interests of this country, when the facts are known and not before.
The right hon. Gentleman contradicted himself. He said that I had said that a single currency could not proceed, and that it would not happen. Then he said that, of course,


it may not—in successive sentences. What I have said consistently is that the small minority may proceed. It is dangerous if a small minority proceeds and is not ready, and it is potentially damaging if a small minority proceeds without knowing the implications for the majority of countries that do not proceed.
Even on the most favourable interpretation and the most optimistic scenario, fewer than half the citizens in the European Union would be part of a single currency union at the outset. That is quite apart from the position of the 10 or more countries that may enter the European Union over the next few years, but which will not be remotely ready for European currency union for very many years in most cases.
For as far ahead as we can see, whether a minority goes ahead—there is certainly a chance that a minority will—it is undeniable that a majority will not be in a single currency in 1999, and a majority will not be in a single currency for very many years.

Mr. Douglas Hurd: Will my right hon. Friend, in contrast to the Leader of the Opposition today, keep his mind open to the idea of a referendum on a single currency, should the Government at any stage decide that it is in Britain's interests to join?

The Prime Minister: I recall discussing that matter with my right hon. Friend as long as two years ago. I know that he has thought long and hard about the implications for Europe and for this country of a single currency. I agree with him that we need to be clear about the circumstances and the conditions. The study that we commissioned in Madrid will help in that.
I can certainly reassure my right hon. Friend that, for a decision of such magnitude, we shall keep in mind the possibility of a referendum, if the Cabinet were to recommend British entry. That has been in my mind, as my right hon. Friend knows, for a long time and it remains there. I think that it is right to keep that before us for consideration.

Mr. Paddy Ashdown: Watch that space. Is not it the case that what the Prime Minister has today described as a formidable programme is what he told us a year ago had about as much relevance as a rain dance? Some rain dance.
Does the Prime Minister understand that the whole nation has now spotted and understands his formula for ducking difficult decisions on Europe? It consists of obstructionism abroad, and appeasement at home; of playing the Euro-realist in the conference chamber, and the Euro-sceptic in the columns of The Daily Telegraph. Does the Prime Minister believe that that is the kind of leadership this country needs on an issue of such importance, and that we should be asked to hide from our future to cover the divisions in the Conservative party?
Does not the Prime Minister understand that trying to face both ways at once in Europe means that he cannot see what is right in front of him? What is now in front of us in Europe is rising nationalism within our borders, deepening chaos outside, and—I regret—the strong probability of isolationism growing in the United States of America. Chancellor Kohl can see that; President

Chirac can see that; and every other leader in Europe can see that. But the Prime Minister is so mesmerised by the divisions in his party that he is blind to it.
The Chancellor said only two days ago that he believed that there was a 60:40 chance of monetary union occurring before the end of the century, and that the economies that would join it would be the strong ones. Does the Prime Minister agree?

The Prime Minister: The right hon. Gentleman started off by completely misquoting what I wrote in The Economist two years ago. The answer to his first question, therefore, is no. He was talking complete unadulterated rubbish, and continued to do so for some time. What I actually wrote in The Daily Telegraph was what I said in the conference chamber to my fellow Heads of Government. The right hon. Gentleman can therefore be in no doubt that the message I deliver here in this Chamber is—

Mr. Ashdown: indicated dissent.

The Prime Minister: Oh, the right hon. Gentleman shakes his head. He was there, was he? It was he who brought in the tea, coffee and the biscuits. What I said in that conference chamber is what I said here, what I wrote down and what I will take to the country.
The fact is that the right hon. Gentleman does not understand the issue. He has a slogan. He believes that whatever happens in Europe, he and his colleagues should rattle along behind it whether it is right or wrong, whether it is considered or not and whether it is in this country's interests or not. He does not know enough about the subject to consider the implications.
What the right hon. Gentleman said was copper-plated nonsense. He does not know, for example, what would be the effect of a partial EMU among some countries on Community decision taking. Can he tell me the answer to that question? Of course, he cannot. He does not even understand the question, let alone the answer. I shall spare the House the long list of the other questions that he does not understand.

Sir Terence Higgins: Is not it high time that we stopped talking about a single currency, as what is now envisaged is clearly a core currency? That is the expression that we should use. Is not it equally apparent that it is inconceivable that the members of an enlarged Community would be able to move towards a single currency in the foreseeable future?
On a referendum, is not this a highly complex issue? My right hon. Friend has rightly pointed out that the leader of the Liberal party does not understand it. The public do not even know the difference between a single and a common currency. Will my right hon. Friend therefore bear the complexity of the issues in mind?

The Prime Minister: My right hon. Friend is entirely right to draw the distinction between a single and a core currency, because, as I said to the House a moment ago, at the outset only a minority would be members. In the couple of decades ahead, with the growth of the European Union, there is no prospect that there would be one single currency right across the enlarged European Union. Of course, it may cover some countries—that has certainly always been possible—but it will not cover them all. My right hon. Friend is right about that.


On the complexities of a referendum, I understand entirely my right hon. Friend's point, and that is why we are considering the matter carefully.

Mr. Peter Shore: The Prime Minister is clearly moving in the right direction—[Interruption.] Will he confirm what he has previously said: that the United Kingdom will not join, or rejoin the exchange rate mechanism during this Parliament? If that is so, as I believe it is, will he confirm that the United Kingdom will not join a single currency on 1 January 1999 for the simple reason that whatever may be the wishes of the Chancellor of the Exchequer, we shall not conform with the necessary qualifying rule of rejoining the ERM two years before the actual decision about the single currency is made in March 1998?
Finally, will the right hon. Gentleman confirm that when he said that he would not recommend that Britain should join or rejoin the ERM after some countries have gone ahead and joined the single currency, that means in effect that we shall never join the single currency because one cannot join it unless one first rejoins the ERM?

The Prime Minister: Let me try to clarify matters for the right hon. Gentleman. I was interested when he said that I was moving in the right direction, because the look of pain upon the faces of those on the Opposition Front Bench was a joy to behold. That was one of those occasions when I am so pleased that we have television in the Chamber.
I certainly reiterate to the right hon. Gentleman that I made it perfectly clear that we would not go back into the ERM in this Parliament. As I said in my statement, I do not propose that I would take sterling back into a changed ERM in the next Parliament either. The right hon. Gentleman concluded from that that we shall not meet the Maastricht criteria, but that is no longer the case, because the ERM that existed at the time of our membership no longer exists. If one were to apply those strict criteria, the reality would be that nobody would be able to enter a single currency. The other Maastricht criteria, of course, fully apply, while the ERM criteria for all of Europe disappear because, the right hon. Gentleman may recall, they were effectively to be a part of the inner band of the ERM, which no longer exists.

Mr. Tristan Garel-Jones: As the number of difficult and technical issues connected with the move to a single currency mount, does not the wisdom of my right hon. Friend in negotiating a double option for Britain become more and more apparent? Will he give the country an assurance that he does not intend to throw away either of those options in the near future?
Secondly, will my right hon. Friend comment on the fact that the Leader of the Opposition, while criticising the opt-out that my right hon. Friend negotiated, clutches it to his own bosom? As the Leader of the Opposition says that there are no constitutional issues attached to a move to a single currency, is not the logic of his position that, if Britain were to be convergent, we would automatically enter a single currency?

The Prime Minister: That is certainly the logic of the Leader of the Opposition's position, and we look forward to his early confirmation of that, so that no one can be in any doubt when he begins the great national debate that he has called for. With regard to my right hon. Friend's

earlier remarks, both the opt-outs are the envy of many of our European partners, which wish that they had negotiated them. I intend to exercise to the full the opportunities given to this country by that negotiation.

Mr. Giles Radice: May I congratulate the Prime Minister and the Chancellor of the Exchequer on publicly resisting the demand of the right hon. Member for Wokingham (Mr. Redwood) and other Euro-sceptics that the Government rule out the option of Britain joining a single currency within the next Parliament?

The Prime Minister: I indicated, first in my reply to the Leader of the Opposition 10 days ago and again over the weekend, that I was not prepared to rule out the option of joining a single currency in the next Parliament. Nobody should draw any conclusions either way about that, and I will reiterate to the hon. Gentleman why that is the case.
It is very important that this country's voice—raising questions that would not have been examined but for this country—is heard in the negotiations right up to the time when a decision is taken as to who should join and who should not. Whether we exercise the right to opt in or to opt out, this country—and every other country in the European Union—will, in one form or another, be affected by the decision to proceed to a single currency, even if only a minority of countries proceed. Upon that basis, I do not believe that this country's voice—one of the most powerful in Europe—should be excluded from that debate.

Mr. William Cash: I very much hope that my right hon. Friend succeeds in his opposition to federalism in Europe, but does he accept that monetary union is tied up with political union? Does my right hon. Friend agree that we sold the pass at Madrid, because we did not disagree with the determination of the other member states—buttressed by the determination of Germany and by a capitulating France—to go ahead with political union? Does he agree that we must ensure soon—in a White Paper or by some other means—that we no longer go down the route of political union? Should we not utterly repudiate the use of British taxpayers' money on a propaganda exercise by the European Commission to promote the very political union that my right hon. Friend has expressed himself to be so against?

The Prime Minister: I do not believe that the pass was sold in our discussions in Madrid. We agreed to discuss questions which must be discussed but which have not yet been discussed. It would be folly to proceed without having detailed and proper answers to those questions. Many aspects of political union will come up in different parts of the intergovernmental conference. We are considering carefully our precise response to all the important points that will come up there.
On the expenditure on publicity, I am bound to say that the Commission's public relations campaign was not, as reported, put to Heads of Government at Madrid and received no specific endorsement from Heads of Government at Madrid. The reason is that the Commission has authority to determine the proportion of its budget to be spent on information work and has chosen to exercise it in that fashion. It was emphatically not a matter that was put to Heads of Government at Madrid and endorsed by them.

Mr. James Molyneaux: The Prime Minister will have noted that on page 8 of the communiqué, there appear the words:
kept on a sound track".
Assuming that those words refer not to some method of amplification but to sound money within Europe, and in view of the fact that the Prime Minister has rightly said that the decision is one of the most important this country has taken for, perhaps, 200 years, will he consider the establishment of a super, high-powered Select Committee, with representatives of all parties in the House thereon, to examine and come up with hard facts as opposed to opinions? Such a Committee would have the extra benefit of enabling certain parties to concentrate their own minds.

The Prime Minister: I can certainly confirm to the right hon. Gentleman that the words "sound track" relate to sound money and sound economic policies. The guiding lights of those were first put in the Maastricht treaty, at British insistence. They remain there for any move forward to EMU and have the strong support of a number of other nation states. I shall reflect on what the right hon. Gentleman said. Within Government, we shall conduct our own examination of whether those matters are being followed, quite apart from an examination of the outcome of the Maastricht criteria.

Mr. David Howell: Does my right hon. Friend accept that his excellent questions at Madrid about the ill-named "Euro", its huge potential cost for the European budget, its divisive potential and its threat to employment in Europe were penetrating and timely? It is a great pity that we have not heard similar intelligent questions from Opposition Front-Bench Members.
Looking ahead, does my right hon. Friend accept that if we get to the transitional period, when a hard "Euro" will circulate along with the national currencies, the system will have some resemblance to his own plan for the hard ecu, which he put forward five years ago? Will my right hon. Friend suggest a more intelligent and modified version, if we get to the transitional period, to make it a permanent period on the ground that nothing lasts like the provisional?

The Prime Minister: My right hon. Friend is correct to say that in the proposed transitional period of 1999–2002, the new currency will effectively co-exist as a parallel currency with national currencies rather than as a core currency, to use the words of my right hon. Friend the Member for Worthing (Sir T. Higgins). That is similar to the hard ecu proposal which I first put forward in 1990, except that it would not proceed, as the hard ecu would have proceeded under my proposal, by a market-driven route to become a single currency, but would move, under the present proposals, arbitrarily on a fixed state to become a single currency.
It may be that as we approach that period, the prospect of reviving the sound economics of the hard ecu proposal will return. At the moment, enthusiasm for proceeding under the Maastricht treaty route remains and I am not optimistic about the hard ecu reappearing. In economic terms, I do not believe by any stretch of the imagination that I am the only Head of Government sitting round the table who now regrets that we did not take that route.

Madam Speaker: Mr. Andrew Faulds.

Hon. Members: Oh.

Mr. Andrew Faulds: Thank you, Madam Speaker. Was there any discussion in Madrid that

because of the plasticity of European purpose, or perhaps lack of policy, America had to step in to sort out the Bosnian imbroglio and bring just the possibility of peace?

The Prime Minister: There was some discussion of future policy in Bosnia. There was no look back on how the present position came about. There was considerable discussion about the peace implementation force and about the activities of Carl Bildt in ensuring that the civilian aspects of the Bosnian peace are carried forward. We spent some time discussing that and no one is in any doubt about the huge matters that still have to be dealt with.

Mr. Nicholas Budgen: Does my right hon. Friend agree that any core currency is bound to contain both France and Germany? France's attitude towards the core currency will be vitally influenced by whether Britain is there as a balancing power against Germany. Are we not going to create great resentment if we do not tell France and Germany as soon as possible what our attitude in principle is?

The Prime Minister: Our attitude is one of practice. We shall make our decision when we know precisely what the circumstances may be that would impact upon our country. Whatever interest we may have in helping France or other countries to make up their mind, and I appreciate that they may welcome a view of where Britain might be at some stage, the first obligation that we have is to make the right decision for this country. I do not believe that we can make the right decision for this country until we know the answer to questions as yet unanswered and know the economic circumstances that have not, as yet, unfolded.

Dr. Jeremy Bray: Does the Prime Minister exclude UK participation in any exchange rate arrangements if EMU does go ahead?

The Prime Minister: I certainly do not exclude UK agreement to matters such as inflation targets in order to ensure a market-driven route towards largely convergent economic policies and secure exchange rates. I do not believe that going back into the artificiality of an exchange rate mechanism, which, on this occasion, would be outside the core currencies, is a negotiable proposition among the Heads of Government and it is not one that I would wish sterling to join, as I said earlier.

Sir Giles Shaw: May I congratulate my right hon. Friend on the way in which he is handling these issues? I remind him that a policy which is both careful and cautious is a policy of prudence and that, bearing in mind the complexity and the scale of the ultimate decisions on the matter, he is absolutely right to occupy the crease and bat for Britain as long as it takes?

The Prime Minister: I am grateful to my hon. Friend, who has a long and distinguished interest in European matters. I assure him that I shall continue to do that. When I indicated to the House earlier that the decisions taken upon monetary matters and enlargement were crucial not just to the future of this country but to the future of all Europe, I did not regard that as a casual throwaway line, but I meant it to be taken absolutely as I stated it. It is fundamentally true. For that reason, I believe that we have an obligation to be cautious. The burden of proof must rest upon those who wish us to make the change rather than those who wish us not to do so. I think that we are right to be cautious and I will remain cautious.

Mr. Dennis Skinner: Is not the truth of the matter that the Madrid decisions, with which the


Prime Minister acquiesced, represent another two or three small steps towards economic and monetary union? Why did not the Prime Minister vote against some of the issues that were presented to him? Why did not the Government decide to oppose that barmy name "Euro" for the currency? Is not the fact of the matter that the Prime Minister has come here today to represent a lot of camouflage about the Madrid summit to try to appease his Back Benchers, when the truth is that he sold out at Madrid and that the people out there will understand that?

The Prime Minister: If camouflage was needed, I would have thought that it was between the Labour Front Bench and below the Gangway on that side of the House. If there is going to be a debate, I suggest that it starts on Labour Benches, and Labour Members can try and work out precisely what their position is. We now see just how split, despite all they have said, they really are on European matters, and have been right from the start. [HON: MEMBERS: "Answer the question."] The answer to the hon. Gentleman's question, in every respect, is no.

Mrs. Edwina Currie: While it is correct, as my right hon. Friend has said, that if the wrong decisions are taken on monetary union, the result will be turmoil and chaos, could I possibly dig out of him an admission, however tentative, that if the right decisions are taken, to create a currency union among 150 million of the world's richest citizens could be highly beneficial to all the nations concerned?

The Prime Minister: My hon. Friend puts precisely the question to which an answer needs to be found. We cannot be certain of an answer to that question without answers to the questions that I asked in Madrid, which is precisely why I asked those questions. We need to know the answers before making a judgment, which is the view of a number of people in Europe. Equally passionate views are held in the opposite direction. Until we know the details and answers to those questions, it is not possible to take a rational view of the implications of a single currency. That is what I seek to provide.

Mr. Tam Dalyell: My question is on a different but increasingly important issue, in view of events in Russia: the Community's relations with the Ukraine. What exactly are we doing to help those people? In his talks with President Kuchma last week, what did the Prime Minister respond to the President, who is also the former technical director of Baikenor, on technical co-operation, not least in relation to the Ukraine's valuable resources in space, which are left over from the Soviet Union, and the skills that could benefit us all?

The Prime Minister: I raised a number of matters when I spoke to President Kuchma a week or so ago. As the hon. Gentleman and the House would have expected, we discussed Chernobyl and spent some time discussing the package of support that the international community has now provided for closing Chernobyl at the turn of the century. We also looked at a variety of ways in which we could increase the trading and investment relationship between the United Kingdom and the Ukraine. There is huge scope, particularly in the energy sector, for the mutual benefit of British investment and for British technology to go into the Ukraine, where it would be warmly welcomed by the Ukrainians. I also stressed to

President Kuchma that one of the inhibitions to ensuring that that investment can proceed are the present financial and legal restraints in parts of the Ukraine.
That was the substance of our discussion. It was an extremely worthwhile visit, which will be followed up by further ministerial visits to the Ukraine. I hope that some of those will take with them high-powered delegations of business men, so that we can examine the business relationship between the United Kingdom and the Ukraine and build on it, because the Ukraine will be an important part of the European business scene in future.

Mr. Hugh Dykes: Despite the usual trading of insults between the party leaders today on this momentous matter, which is of great importance to this country, and the regrettable lack of listening to the sensible suggestions made by the leader of the Liberal Democrats, would not it be a good idea for the party leaders to get together? As a large majority of Members of this House are in favour of EMU, they could, on a free-vote basis, present the positive factors in favour of monetary union to the British public.

The Prime Minister: I always believe in the politics of rationality. My hon. Friend pitches a question that would demand a high price for the Leader of the Opposition in terms of discussing the reality of what lies immediately ahead. I saw no great sign of it from the leader of the Liberal Democrats this afternoon. If we can determine the answer to the questions that I have put, they will be material to framing the opinions of people in this House and beyond about the desirability or otherwise of the course that was set out some time ago. I reiterate the same point because it is undeniable: without that information, credible decisions cannot be taken. I am trying to provide it. I shall then willingly make it available to the Leader of the Opposition in a tutorial or in any other way that he wishes.

Mrs. Margaret Ewing: As a decision must ultimately be taken, will a time limit be placed on the study? What will happen once the study becomes available? Will it be widely available and how will we move into decision mechanisms?

The Prime Minister: It is not quite clear how long the study will take. I saw it reported that it will take two or three years. That is clearly nonsense—it will take nothing like that. I would expect a report when we get to Florence in the summer, but I am not sure whether it will be the definitive report, and neither is anybody else. Once the report has been produced, I am sure that it will be discussed by ECOFIN and the European Council. It may be placed on the European Council's agenda, but that has not yet been decided.

Sir Teddy Taylor: In view of the substantial misery and unemployment created already by European fixed exchange rates, is the Prime Minister aware that people with all kinds of views of EMU will enthusiastically welcome his statement that, in the event of the "Euro" being established by a small number of countries, there is no way that sterling will have a fixed relationship with it? Am I correct in my interpretation and, if so, does the Prime Minister accept that that will be very widely welcomed, not only in the Conservative party?

The Prime Minister: Yes, my hon. Friend sets out the position entirely accurately. It is as he says.

Mr. Tony Banks: May I say to the Prime Minister that, personally; I very much welcome the concept of a single currency, although certain safeguards are necessary, including making unemployment levels part of the convergence criteria?
On a more practical matter, was the story in the Sunday newspapers—that the Queen's head is too large for the "Euro" coin—true? If that is so, does the Prime Minister intend to negotiate the size of the coin, or does he have more drastic measures in mind?

The Prime Minister: On the hon. Gentleman's first argument about unemployment levels, I simply have to say to him that, if he were to make unemployment levels part of the convergence criteria, there would be no single currency in his political lifetime, however long that is likely to be.

Ms Clare Short: It depends what the banding is.

The Prime Minister: The hon. Lady says, "It depends what it is." She probably believes that the 13 per cent. of France is a good convergence level. I am not sure that that is what her hon. Friend had in mind. Perhaps that is another difference between Labour Front and Back-Bench Members; I cannot imagine. We seem to be uncovering so many differences today that it is difficult to determine. Let us hope that we can go on and find some more.

Sir Peter Hordern: As very few countries will be able to qualify for the single currency, will my right hon. Friend say what the position of those countries will be when they find that their economies are subject to intense competition from the countries that do not form part of the single currency? Will he give the House an assurance that, in that event, there can be no suggestion of any reprisals being taken by members of the single currency against countries outside it?

The Prime Minister: My right hon. Friend puts his finger on precisely one of the matters that I have been raising with our colleagues at the European Council. It is precisely for that reason that some of the countries that anticipate that they will be in a single currency have asked for an exchange rate mechanism outside the single currency, to prevent the flexibility with which countries usually deal with economic difficulties. The danger of that, apart from the inherent difficulties that have been demonstrated several times in the past six or seven years, is that it would lead to very high structural levels of unemployment in some of the weaker-performing countries in the southern part of Europe.
That is precisely the matter that the hon. Member for Newham, North-West (Mr. Banks) brought to the forefront of my mind a moment or so ago, when he suggested that unemployment levels should be convergent. If that were the case, many of the southern countries of Europe would never, on that basis, be likely to meet the criteria for gaining admission to a single currency. That might mean that a European Union—although I believe that it will become more variable in the application of its policies to different members, and I believe that that is desirable—would for the first time find a fundamental variation in policy on one of the very basics of the whole basis of the European Union, that is, the currency question.
Those are questions of immense importance. There is, as yet, no credible answer to the question that my right hon. Friend asks. I am asking for one.

Mr. Nigel Spearing: As economic and monetary union surely requires the convergence of the total economies of the member states, why is it that only certain indices in the public sector are included? Why not also include comparable indices in the balancing private sector?
Surely economic and monetary union also requires the establishment of a centralised, absolute monarchy of bankers, who are separate from national Governments and from the institutions of the Community. However, surely one of the principles of European Union is to defend the western view of democracy, which is voting into power assemblies that, in turn, control government? Is not that an anomaly, and will the Prime Minister tell us whether the European Council has explained that anomaly? If it has not, will he do so now?

The Prime Minister: I have some sympathy with the hon. Gentleman's earlier comments about convergence, although he is plainly wrong when he refers to convergence as only affecting matters in the public sector. One of the most important convergents is a high degree of price stability. Price stability, which has clear implications for what is happening elsewhere in the economy, not only is a matter for the public sector, but goes right across the economy as a whole. The hon. Gentleman is wrong on that point and I think that his subsequent points were addressed and determined many years ago.

Mr. Bernard Jenkin: May I congratulate my right hon. Friend on his description of the other member states, which he said were rushing like lemmings over a cliff towards currency union? While 150 million people may be inside the currency union, is it not a fact that 5.5 billion people remain outside it? Is it not a perfectly viable option for this country to choose to opt out of monetary union and model ourselves on the thousands of economies round the world—large and small—which have independent currencies?

The Prime Minister: That is certainly an option. From the moment when I negotiated the opt-out at Maastricht, it has always been possible that this country might decide to take the decision, in its own interests, not to be a part of a larger currency union. There is no doubt that we could continue without entering into a currency union. We would have to decide whether the balance of advantage for the Government, the City, the economy and our future trading relationships rested with our being in or being out. That is precisely the substantive point. Of course we could be out and there is no doubt that we could stay out. We shall have to weigh the balance of advantage when the time comes.
My hon. Friend is correct in his earlier point: more citizens of Europe will be outside the single currency at the outset, and for some years afterwards, than inside it.

Mr. Donald Anderson: Will the Prime Minister confirm that it was the common understanding of our partners at Madrid that no substantive decisions would be made on the IGC until after the conclusion of the election in this country? Does that not mean that,


increasingly, this Administration will be seen by our partners as a lame duck Administration, which is bad for Britain?

The Prime Minister: The hon. Gentleman builds his question upon a false premise, as there was no such agreement at Majorca or at Madrid. When we begin the intergovernmental conference, which will be launched in Turin on 29 March, I hope that we shall begin to take decisions as we move through the year. Decisions will not all be held to the end of the year. We may complete the intergovernmental conference within a year, or it may take longer. If we complete it within a year, the whole matter may be determined within the lifetime of this Parliament. That is the decision that I have reached and, unless the hon. Gentleman was serving biscuits somewhere, he is in no position to shake his head.

Sir Archibald Hamilton: Does my right hon. Friend agree that much of the drive in Europe has come from Germany, which has a lot to do with the fact that Chancellor Kohl is ashamed of Germany's past and frightened for its future? Does my right hon. Friend also agree that the democratic institutions in Europe are woefully inadequate? If we drive towards political union without proper democratic representation at the centre, it will lead to the emergence of fascist and ultra-nationalist parties, which will want to withdraw from Europe and break up the European Union. That would deny Chancellor Kohl the goal that he is seeking and, for many hon. Members, would lead to a very unsatisfactory outcome.

The Prime Minister: The democratic institutions of Europe are bound to be considered at the intergovernmental conference. That is true of both the present powers and nature of the European Commission and the other institutional questions, which will be considered expressly during the forthcoming intergovernmental conference. We must examine those issues for another reason, apart from those set out by my right hon. Friend. As the European Union enlarges—as I profoundly hope that it will——I believe that it will provide an historic opportunity for this generation of politicians to change the face of Europe in a thoroughly beneficial way. In those circumstances, many of the present institutions of the European Union will prove inadequate to deal with the enlarged number.

Several hon. Members: rose—

Madam Speaker: Thank you, Prime Minister. We must now move on to the second statement. I regret that so many hon. Members are disappointed, but I have kept the Prime Minister at the Dispatch Box for more than an hour.

Rail Franchising

The Secretary of State for Transport (Sir George Young): With permission, Madam Speaker, I should like to make a statement on the franchising of passenger rail services.
The House will be aware that, on Friday, the Court of Appeal, considering an application for judicial review by Save Our Railways, found against the Director of Passenger Rail Franchising on whether the passenger service requirements for some of the first seven franchises had been developed in accordance with the instructions and guidance that had been issued to him by the Secretary of State.
The court ruled that the franchising director could proceed with the award of the first three franchises—Great Western, South West Trains and London Tilbury and Southend Rail—although it ruled that the PSR for LTS Rail was not consistent with the instructions. The court also ruled that the PSRs for the next four franchises were similarly inconsistent. In doing so, the court was overruling an earlier judgment of the High Court that had dismissed the judicial review.
The court's ruling comes after the franchising director made excellent progress in preparing the first franchises for award to the private sector. Indeed, the first three franchises are ready to be awarded soon.
We have, of course, given careful consideration to the implications of the court's judgment. I confirm that, as planned, the franchising director hopes to announce the award of the first three franchises later this week, and I welcome the court's agreement that he should go ahead with them.
The court has been concerned with the consistency between the franchising director's instructions and guidance and the PSRs. It is, in the court's words, a "limited legal problem". The court has not questioned the Government's policy. Indeed, the judgment describes the franchising director's approach to developing PSRs as
intelligible and in no way irrational".
The franchising director has prepared his PSRs in a manner which my predecessors and I have consistently approved. We believed them to be consistent with the formal instructions and guidance that were given to him. The Court of Appeal has now examined the meaning of the existing instructions and guidance and concluded that the existing PSRs are not consistent with them.
I have decided, therefore, to clarify the instructions and guidance to the franchising director to ensure that they reflect beyond doubt the policy that we have always followed. Franchisees should have flexibility to adjust commercial services, but the franchise agreement should ensure that a core service level is protected so that service levels operated by franchisees are broadly similar to those operated immediately prior to franchising. My intention is to ensure that the work done in developing the PSRs so far can be relied on in the continuing franchising process.
I am pleased to tell the House that, while clarifying the franchising director's instructions, I intend to go beyond the requirements of the Court of Appeal judgment. I shall instruct him, when considering the award of future franchises, to take account of bidders' contractual


commitments to, and future plans for, providing services over and above the PSR. In practice, bidders for the first franchises are offering significant commitments in addition to the minima required by the invitations to tender, and they have been taken into account by the franchising director when evaluating bids, but I have judged it right to require him formally to do so for the future to ensure the continuation of that policy.
In view of the uncertainty generated by the court's judgment, I hope that the House will welcome this statement of the Government's intentions. Our concern is to ensure that passengers should be allowed to enjoy as soon as possible the benefits that franchising will bring. The Government's policy has been clear and consistent and I assure the House that there will be no change as a result of last Friday's judgment.

Ms Clare Short: Will the Secretary of State confirm that his statement amounts to an admission that the early franchises prepared by the franchise director, who is a creature of the Secretary of State, did not guarantee services as good as those currently provided by British Rail? Does he further agree that the courts found that five of the seven early franchises were in breach of his guidelines and undertakings to Parliament?
Will the Secretary of State clarify his statement in plain language? Is he admitting that, because the early franchises were not in line with his own guidance, he now plans to rewrite the guidance and reduce the minimum standards required to "a core service level"—which is a new concept—and to take into account non-contractual promises? Will his revised guidelines permit the four franchises that were ruled illegal by the Court of Appeal to go ahead without revision?
Does the Secretary of State agree that the first three franchises should now be withdrawn? First, the franchise for the London-Tilbury-Southend line was held to be illegal by the Court of Appeal, although for technical legal reasons it was not stopped; in honour, it should be stopped. Secondly, it would be wrong to let early franchises on the basis of guidelines that are different from those that will apply to later franchises. Indeed, I think that it would lead to litigation.
Finally, does the Secretary of State accept that even those who initially supported rail privatisation now believe that the method chosen by the Government is a disaster and will produce less investment and worse services in return for more public subsidy? Will the right hon. Gentleman now agree to halt the privatisation process and review progress? Surely he will agree that it is wrong for him to proceed on the basis of party dogma. His duty is to protect the national interest—and that requires him to halt the process of rail privatisation.

Sir George Young: I was pleased to see on Ceefax that the hon. Lady is reported to have welcomed Railtrack's current 10-year investment strategy. That strategy is possible at the higher level envisaged only because we are privatising Railtrack. At no point has the hon. Lady or the Labour party made a commitment to provide more resources for Railtrack, but more resources will be available as a result of privatisation.
The court specifically ruled that the franchising director should be allowed to go ahead with all three of the first franchises, as it would be detrimental to good

administration if he were prevented from doing so. I hope that he will proceed; I think that when he does, and when the franchise bids are in the public domain, people will realise that much of the concern that has been expressed is unfounded.
I hope that the hon. Lady noted from my statement that, to deal with some of the concern that has been expressed, I am giving guarantees over and above those that were necessary to comply with the court's judgment. It is important to understand that the minimum PSRs are not the same as the timetable. I genuinely believe that, as we make progress with franchising, and as people see the quality of the bids and the range of services provided by the private sector, much of the concern of the past few weeks will be shown to have been unfounded.

Sir Alan Haselhurst: Do not the Government's critics seriously underestimate the level of service that will be provided under the franchises? Will not the timetables prove less of a mirage than some of those published by British Rail? At present, services can be removed with relative impunity—as, for example, on the London to Cambridge line, which goes through my constituency. No guarantees whatever are given.

Sir George Young: My hon. Friend is absolutely right. Under the structure that we are introducing, passengers will be given guarantees that were not available to them before. First, key fares will be guaranteed and linked to the retail prices index or lower. Secondly, as my hon. Friend rightly pointed out, services specified in the contract will have to be provided for a minimum of seven years. That guarantee has never existed under a regime operated by British Rail.
I also agree with my hon. Friend's view that, now that we can make progress with the awarding of franchises, people will realise that a better service can be provided. We want to hear from the Opposition at some point whether they will confiscate franchises from the private sector even when they provide passengers with a better service at less cost to the taxpayer.

Mr. David Chidgey: The Secretary of State will know that, in our previous debate on this matter, it was made clear that the PSRs were based on the existing British Rail timetable. It appears from the right hon. Gentleman's statement that they will be based on something broadly similar to existing services. By what criteria will he be guided in future in ensuring that the PSRs are legal?
It seems that the right hon. Gentleman intends to proceed with the first tranche of three franchises with the current PSRs rather than with what would be preferred. If that is so, does he recognise that inconsistencies will be built in across the region between two levels of service? What action does he propose to overcome that inevitable disparity?

Sir George Young: I said in my statement that I planned to change the guidance and instructions, and explained the general lines on which that would be done. I shall, of course, place the new guidance and instructions in the Library so that hon. Members may inspect them.
I genuinely believe that the franchising director is approaching the matter in the right way. The country has been divided into 25 regions. The franchising director is inviting people to bid for services; he will then choose the best bid. I believe that, when we make progress with the


policy, the hon. Gentleman will see that it is possible to run a railway that is better than that of the past 30 or 40 years, which has consistently declined. Our policy will unlock access to fresh investment that will not be constrained by being in the public sector, and will invite people outside British Rail to operate services. I think that it is possible to provide a better range of services, to market those services more efficiently, to introduce more creative fare structures and to reverse the historic decline in railway use—and I believe that our policy will do that.

Mr. Paul Channon: The guidance that my right hon. Friend has announced will be widely welcomed both in the House and outside. It would be disastrous if the first three franchises were not awarded. Is my right hon. Friend aware that my constituents, who have lived with an inadequate British Rail service for half a century, are now looking forward to a better service, and look to him to ensure that the process goes ahead?

Sir George Young: I am grateful to my right hon. Friend for his support. I can confirm that the franchising director has said that there have been good quality bids in response to the invitations to tender. I hope that, in the near future, it will be possible to proceed with the franchise for LTS Rail; my right hon. Friend's constituents will then be able to see the quality of the service being offered, and the debate will move from the theoretical to the actual. People will be able to see for themselves exactly what services are being provided, and I am happy for our policy to be judged on that basis.

Mrs. Gwyneth Dunwoody: Is it not demeaning for a Secretary of State to have to rewrite the rules to bring the bids into line? Will the right hon. Gentleman tell us precisely how much each taxpayer will have to pay if the Government write off billions of pounds of debt, throw away the assets of the railway system and, on top of that, make taxpayers provide a larger subsidy than they provide now?

Sir George Young: The hon. Lady will not be surprised to learn that I do not agree with the thrust of her questions. All our experience has shown that, at the end of the day, the taxpayer does better when nationalised industries are privatised. We are familiar with the £50 million a week that the nationalised industries were costing us, and the £50 million a week that the privatised industries now bring in. I see no reason why our privatisation policy should not bring benefits not only to taxpayers but to passengers.

Sir Roger Moate: Does my right hon. Friend agree that, if the Opposition were truly interested in the travelling public and the railway industry, they would oppose any further delays and uncertainty? If we are to secure much-needed investment, the faster we get on with the franchising process the better. Will my right hon. Friend assure us that the next batch of franchises will be let very rapidly, particularly the franchise for the South Eastern Train Company?

Sir George Young: I am grateful to my hon. Friend for his support. I hope that, now that we have clarified the legal position, the franchising director will be able to make good progress with the next round of franchises.
What we must hear from the Opposition at some point is where the extra investment is to come from if it is not to come from the private sector. Is it to be

secured by means of higher taxation or higher fares, or would Labour cut the level of service provided by British Rail?

Mr. Gerald Bermingham: I welcome the good news—for those who have a railway in their area—that fares will be pegged. Will the Secretary of State confirm, however, that the secret of the process is the question of core services? "Core services" means scarcer services. The right hon. Gentleman appears to be doing to our rail services what Beeching did some years ago: he pulled down a three-storey mansion and replaced it with a cottage. Now that the cottage is to go, what will be left, particularly in the north-west?

Sir George Young: I am not sure that the hon. Gentleman has looked at the details of what is proposed by the franchising director. Every station and every line is guaranteed, and we have opened or reopened some 229 stations since we came to power in 1979. The Beeching decimation was a feature of a previous Labour Administration. I am determined to reverse that and to secure a prosperous railway that is built on the private sector, that is more customer-oriented and that is not wholly dependent on taxpayers' funds. I hope that the hon. Gentleman's constituents will be better served by the railway that I have just described.

Sir David Madel: Can my right hon. Friend confirm that the franchising director will look in particular for a commitment to improve industrial relations when franchise companies run the lines?

Sir George Young: The franchising director is responsible for deciding who shall pre-qualify for the bids, and I know that he will take into account the factor that my hon. Friend has outlined.
During the past few years, British Rail has been disrupted by industrial action. I hope that the more regional approach that we have promoted—whereby local employees deal directly with one of the 25 operating companies—will reduce the likelihood of national strikes. I believe that smaller units of management and a better relationship between staff and local management is a better way in which to promote good industrial relations.

Mrs. Anne Campbell: If the Secretary of State were to respect the Appeal Court's decision, would he be required to give new instructions to the franchising director? Will he put rail privatisation to the test and allow a vote in the House—or is he too worried about the reactions of his Back Benchers?

Sir George Young: No vote is required in the House to change the instructions. I would welcome such a debate and a vote and would hope that the Opposition would come clean on their policy for British Rail. Do they believe in a publicly owned BR? If so, how would they pay for it?

Mr. Nigel Forman: Is my right hon. Friend aware that it is the inevitable complexity of some of the arrangements that causes uncertainty and concern among my constituents, and that he would go a long way towards reassuring my rail-travelling constituents, of whom I have a large number, if he were to give us some idea how the new policies would address the problems that are caused by the unreliability of services, the problems of signalling failures, which are


all too frequent, and the fact that overcrowding is now a characteristic of all too many services on the Carshalton line?

Sir George Young: Overcrowding will be dealt with specifically in the franchising director's requirements.
The new regime introduces tough penalties for Railtrack if it fails to provide a path, and for the train operator if it fails to use a path that is made available to it. The new financial regime will provide a strong incentive for punctuality.
I think that everybody who looks at this matter objectively agrees that we are more likely to get the investment that we need if the railways do not operate within the constraints of the public sector, competing against hospitals and schools for investment. The best answer that I can give my hon. Friend is not to tell people, rather to show them by making progress with the policy so that they can judge for themselves the quality of service that can be provided.

Mr. Tam Dalyell: How many adequately remunerated lawyers are available to the franchising director and the Department? How in heaven's name did they manage to get it so wrong?

Sir George Young: The franchising director was successful on judicial review; Justice Macpherson dismissed the challenge, awarded him costs and refused leave to appeal. Last Friday, the Court of Appeal overturned that decision on what it described twice as a limited legal problem. It also identified at the end of the judgment a possible solution—that the Secretary of State could change the instructions. That is the solution that I have adopted.

Mr. Bob Dunn: As, for the first time, passengers will now have guarantees on services and fares, can my right hon. Friend tell the House how those guarantees will be monitored? Will he continue to drive on in the way he announced, because Conservative Members want to put the passenger first, whereas the Opposition wish to leave left-wing trade unions in control of a nationalised industry?

Sir George Young: The House will be refreshed by my hon. Friend's robust common sense.
The franchising director has all the powers that he needs to ensure the guarantees on services and fares. The operator will not be able to increase fares beyond a level approved by the franchising director, and there will be a clear contract outlining the services that the franchise operator has to provide. That will be part of the contract with the franchising director.

Mr. Dennis Skinner: Will the Secretary of State admit that one of the key reasons why the exercise of privatisation is taking place is, among other things, to reduce the number of trade union jobs on the railways? Now that he has come up with a new proposal to rewrite the timetables—I presume that there will be fewer trains—how many fewer jobs will there be?

Sir George Young: The object of the policy is to get more people to travel on the railways and to improve the quality of service that they receive. I very much hope that

the railways of the future will provide good, well-remunerated employment for those who work on them.

Sir Teddy Taylor: I am a regular traveller on the very unsatisfactory London-Tilbury-Southend line, which has problems, including those of this morning. Is my right hon. Friend aware of the great danger that, after privatisation, every time a train is late or a light bulb is not working, privatisation will be blamed? Will he tell the whole story—I am sure that it will be a good one—and publish every three months details of what has happened, such as whether there are more passengers and whether the trains are more punctual? Will he tell the public and the House the whole story about the first lines to be franchised so that the public can see precisely what has happened and whether things are getting better, as I believe they will, or worse?

Sir George Young: I recall travelling on that very train service with my hon. Friend three or four years ago, when he took the opportunity to communicate to me some of his views on the Common Market.
I think that there will be intense public interest in the first franchised services when they become operational next spring. I welcome that publicity and am confident that those who win the franchises will respond to it, because they will have the same interest as the Government in showing that the new regime is a better way to meet the needs of the passengers. I welcome all publicity about the progress that will be made as our policy develops.

Ms Glenda Jackson: What confidence can the House and the country have in the Secretary of State's statement that he intends to issue new guidance and instruction, as the previous guidance and instruction was found not to be legal? Surely the door has been opened for an individual to take a passenger service requirement to court. As the Secretary of State knows, the taxpayer is paying £23,000 per day in legal fees alone associated with rail privatisation. Will he tell the House how much last week's legal adventure cost the taxpayer and how much he expects the taxpayer to have to find in the future?

Sir George Young: If the hon. Lady tables a detailed question, we will give her the information. I am confident that the action that I have outlined today—a potential solution outlined by the Court of Appeal—is the right way forward, and I believe that it will give a better deal to her constituents who travel by rail. I hope that, at some point, the hon. Lady and her party will come clean on how they would provide the level of investment now envisaged by Railtrack which is over and above that which would have been provided by British Rail.

Mr. Barry Field: Is my right hon. Friend aware that, when the privatisation of British Rail was first announced, the Isle of Wight was at the top of the queue? Unfortunately, for reasons that nobody has been able to discern, it is now at the bottom. When my right hon. Friend sends the franchising director instructions, will he tell him where the Isle of Wight is, and remind him that it is the most simple of all privatisations? Can we please get on with it? Everyone on the Isle of Wight is extremely anxious to get the train out of the station and on to the track so as to give a better and more comprehensive service?

Sir George Young: I am delighted to hear of the appetite for privatisation among my hon. Friend's constituents. I shall ensure that the franchising director is aware of my hon. Friend's enthusiasm that that particular franchise should be brought forward.

Mr. Hugh Bayley: When the Railways Bill was before the House, Ministers repeatedly assured the House that franchised services would be based on the BR timetable. The Secretary of State has now amended that to "broadly similar to". Will he tell the House whether that amendment would increase or reduce the minimum requirement for franchisees?
With specific reference to the east coast service between London and York, will he confirm that the passenger service requirement will allow franchisees to drop the number of weekday trains from 26 to 17 a day? Will his new formulation allow such a large drop? Will he say what will be the minimum number of daily weekday trains between London and York under his new formulation?

Sir George Young: It is worth reminding the House that the Select Committee on Transport endorsed the broad approach that the franchising director has adopted in identifying minimum PSRs. The Select Committee stated:
We also have no objection in principle to the omission of profitable services form PSRs since it would be in franchisees' interests to provide them.
The hon. Gentleman will find some reassurance in my statement because, when awarding future contracts, the franchising director will have regard not just to minimum PSRs but to the totality of services that are offered by those who are bidding for the franchises. It is important for people to understand that minimum PSRs are not the same as timetables. I hope that my statement goes some way towards removing concern.

Dr. Robert Spink: Does my right hon. Friend agree that the franchising director's announcement later this week for the London-Tilbury-Southend line will enable the successful bidder to state the level of service that is intended? I suspect that it will be far in excess of the minimum PSR. Does my right hon. Friend further agree that the successful bidder will announce the future investment programme which, I suspect, will also be welcome news for my constituents—although Opposition Members who represent the vested interests of the trade unions may not be so happy?

Sir George Young: I entirely agree with my hon. Friend. Now that we have resolved the uncertainty, it is important to make progress and to put in the public domain the level of services that are being offered. When that happens, my hon. Friend's constituents will see exactly what is offered by those who have bid for the franchise. I hope that the franchising director will soon award the LTS Rail contract.

Mr. Kevin Hughes: Does the Secretary of State agree that Doncaster is a major station on the east coast main line? At the moment, 33 northbound and 32 southbound trains stop at Doncaster, but there is increasing speculation that in April 1996 that number will be significantly reduced. In the light of last week's Appeal Court judgment, will the Secretary of State guarantee that those services will not be reduced?

Sir George Young: The hon. Gentleman is making the mistake, to which I referred a few moments ago, of

assuming that the minimum PSR equals the timetable. The Select Committee has made it quite clear that it is legitimate to specify the loss-making services. The franchise operator has an incentive to provide the profitable services. There is no advantage in ossifying the timetable by specifying it in advance and giving a franchise operator no freedom or flexibility to grow the market and respond to it. If the hon. Gentleman is patient he will see that his fears about dramatically reduced services are unfounded.

Mr. Peter Luff: Does my right hon. Friend understand that his best Christmas present to the people of Worcestershire would be to put all the pressure that he can on the franchising director to ensure that the franchise for the Great Western main line service is announced this week? Does he understand my enthusiasm for winning for my constituents the improved services that franchising will bring and for the first ever guarantees of express trains between Worcester, Evesham and London since the Oxford, Worcester and Wolverhampton railway began services in, I think, 1853?

Sir George Young: I welcome my hon. Friend's enthusiasm and I share his hope that we may be able to make progress with the Great Western railway in the near future. I think that we shall see franchisees offering services above the PSRs and, of course, they will have incentives to attract more passengers to their trains. We want to reverse the historic decline in the use of the railways. The structure that we are promoting is the right one to do that.

Mr. Peter L. Pike: If the Isle of Wight is at the bottom of the list, will the Secretary of State put Lancashire and the north-west there instead, because that would certainly be welcome? Despite what the right hon. Gentleman says about PSRs, people believe that they will lead to a reduction in service provision. Will he guarantee that those who win the franchises will not be able to come back at a later date and ask for a reduction and a renegotiation of their seven-year contracts?

Sir George Young: They will have seven-year contracts with the franchising director. I invite the hon. Gentleman to wait. I hope that, within a few days, he will see for himself whether those who win the franchises offer services above the PSR—as I believe will be the case. The hon. Gentleman will also see whether they offer better services than British Rail. When that information is in the public domain, people will be able to judge for themselves whether our rhetoric or that of the Opposition is correct.

Mr. John Gunnell: Does the Secretary of State recall that, the last time a group of his hon. Friends rebelled on these issues, the Secretary of State gave commitments, one of which has been mentioned today, on the retention of timetables and the stability of fares, and about British Rail being allowed to bid for franchises? Is not it true that all the proposals have been watered down, that the Secretary of State is not honouring any of the commitments and that, overall, he will create a weaker service in the long run?

Sir George Young: I am not aware of having broken any undertakings given by any of my predecessors. I have developed a policy that was worked on by a number of Secretaries of State and I have taken it forward. I hope to have the good fortune to be Secretary of State while the benefits of the policy come into the public domain.

Mr. Nick Ainger: Does the Secretary of State accept that, on the first three franchises, he got off


on a technicality? As he has announced that the PSRs for the franchises that he is holding back will be "broadly similar" to the current timetable, has not he now established a two-tier franchise, with the first three franchisees being penalised far more than the others? In relation to the Great Western PSR, there is a 100 per cent. cut to the existing timetable, and the line between Swansea and Paddington has had, on average, a 20 per cent. cut. Are those timetables "broadly similar"?

Sir George Young: If the hon. Gentleman looks at the Appeal Court judgment he will find a response to his question about GWR.

Mr. Ainger: It is a technicality.

Sir George Young: The hon. Gentleman speaks about a technicality, but the Court of Appeal spoke about a "limited legal problem". It stated:
We confine our attention to the much more limited legal problem defined above. In approaching that limited legal problem the court must steer very well clear of any involvement in making or evaluating substantive decisions.
The answer to the hon. Gentleman's question is that, if these matters reach the public domain, he will see for himself whether GWR plans to provide the basic minimum or whether it plans to provide much more than that. If we can make progress, the answer to the hon. Gentleman's question will shortly be in the public domain.

Mr. Nick Harvey: The Secretary of State drew great comfort from the court's finding one aspect or another of his policy not to be irrational. Does he see that it would be wholly irrational for the rest of the country to be served by franchise holders who guaranteed to provide services that were equivalent to the old BR timetable while those who served the south-west were at liberty to reduce them considerably? If the much-derided British Rail is capable of providing 14 services a day form Taunton to London, why should the new franchise holder be asked to guarantee to provide only eight? Will the Secretary of State make it a matter of policy to put the south-west on the same footing as the rest of the country regardless of whether there is a technical hitch with that part of the court case?

Sir George Young: If the hon. Gentleman waits he will see whether South West Trains or Great Western Railways are putting in only the minimum PSR. If, as I expect, they put in more than that, the hon. Gentleman's question falls.

Mr. Brian Wilson: The Secretary of State's quite extraordinary inability to answer

the questions asked by my hon. Friends the Members for York (Mr. Bayley), for Doncaster, North (Mr. Hughes) and for Pembroke (Mr. Ainger) and by the hon. Member for North Devon (Mr. Harvey) reveals the fraudulence of his statement. Does he not understand that the courts have told him that it is unlawful to propose passenger service requirements that are 20, 30, 50 or 100 per cent. below the existing timetable? He cannot tell the House that the import of his new guidelines is that it will be impossible to present passenger service requirements at the same unsatisfactory levels. Will he answer my hon. Friends' question about whether the door is still open for the kind of passenger service requirement that the courts were concerned with? Will he recognise that this will be remembered as the day that the passenger service requirement was redefined as a "core service level"—three weasel words that will be understood throughout the country even if they are not understood by the right hon. Gentleman's Back Benchers.
The Secretary of State also evaded the question asked by my hon. Friend the Member for Burnley (Mr. Pike). Will he say clearly whether, when the ballyhoo about the franchises has died down, it will be open to franchisees to come back and demand either a reduction in service or more money from the franchising director as long at the Tories are in office?

Sir George Young: I invite the hon. Gentleman to read my statement again. I made it clear that I was going beyond the steps necessary to meet the Court of Appeal's decision. I hope that I gave him some reassurance that the timetable was not the same as the PSR.
The approach that the franchising director has adopted was described by the Court of Appeal as
an intelligible and in no way irrational approach.
It is a broad approach that was supported by the Select Committee. The Court of Appeal pointed out that it was open to the Secretary of State to amend the instruction. I have told the House that that is what I propose to do.
The important thing is to move this debate on from the theoretical to the practical to enable the franchising director to award franchises and to enable people to see the quality and frequency of service that is being offered. People will judge for themselves. I suspect that, in 18 months' time, or whenever the election is, Opposition Members will fight shy of saying, "We are going to cancel all this and give it back to British Rail." When we hit an election, when the services are up and running, people will find that they are popular and better, and the Labour party, as it has done before, will do a U-turn.

Orders of the Day — CONSOLIDATED FUND BILL

Order for Second Reading read.

Question, That the Bill be now read a Second time, put forthwith, pursuant to Standing Order No. 54 (Consolidated Fund Bills), and agreed to.

Question, That the Bill be now read the Third time, put forthwith, and agreed to.

Bill accordingly read the Third time, and passed.

Orders of the Day — Hong Kong (Overseas Public Servants) Bill

Not amended (in the Standing Committee), considered.

Order for Third Reading read.

The Minister of State, Foreign and Commonwealth Office (Mr. Jeremy Hanley): I beg to move, That the Bill be now read the Third time.
I explained at Second Reading that the Bill was an enabling measure that will allow the Government to offer a package of benefits to certain overseas Hong Kong officers. In particular, we propose to put in place schemes, by Order in Council, to pay officers compensation for loss of their career prospects, and to provide Hong Kong overseas pensioners with a measure of protection for the sterling value of their pensions. Officers would be allowed to retire prematurely before 30 June 1997 and be entitled to resettlement help.
I am grateful to hon. Members who served on the Standing Committee that examined the Bill. All hon. Members who spoke recognised the contribution that Hong Kong overseas officers have made to Hong Kong's success, and that they should receive benefits similar to those provided to their predecessors in 42 former British dependent territories. It is gratifying that no hon. Member questioned the Bill's object and I am especially grateful for the serious and responsible speeches made by the hon. Member for Leeds, Central (Mr. Fatchett), and for the detailed study of the matter by the hon. Member for Wrexham (Dr. Marek), who kindly notified us that he was monitoring elections elsewhere, but that he had no questions to raise.
The Bill passed through Committee unamended and I do not have any Government amendments to propose. I did, however, give a ministerial undertaking in Committee to provide the House with two reports, which would set out the sort of resettlement provided to officers who decided to retire prematurely and the expenditure on the various schemes. They would also provide an assessment of the impact of early retirements on the Hong Kong civil service. The first report will be presented to the House before 1 January 1997, and a second before 30 June 1997.
I commend the Bill to the House.

Mr. Derek Fatchett: Throughout the deliberations on this proposed legislation, the Labour party has backed the Government's position and its reasons have always been clear. First, the Bill ends the uncertainty faced by members of the overseas civil service. There has been a protracted negotiation period and I think that all the civil servants are delighted that that process has been completed and that the Bill is before us. Secondly, the Minister rightly says that the scheme is in line with 42 other schemes, which is why we also support the proposal, although conditions and circumstances in Hong Kong differ from those in the other 42 cases. Clearly, it is correct that the treatment of overseas civil servants in Hong Kong should be similar to that of civil servants in all the other cases. Thirdly, the Bill gave us an opportunity to give our thanks to the


overseas civil servants who have worked in Hong Kong over many years, and who have helped to make a substantial contribution.
Like the Minister, I welcome the way in which the Committee dealt with the issues. As the Minister said, my hon. Friend the Member for Wrexham (Dr. Marek) is not able to be with us today. He is monitoring elections in a much warmer climate and I am sure that he is doing that job with his usual commitment to detail. It was because of him that we had much more detailed information about how the pension scheme would work and the sterling guarantee. On behalf of all Committee members, I thank him for that.
I thank the Minister for his concession, if I may use that word, to us in Committee and for his promise this evening to make two reports available in the run-up to 1997. That will be welcomed by all hon. Members because it will give us the opportunity to continue to monitor the scheme and how it works.
I put on record the fact that we had a good debate in Committee about the nature of the sterling guarantee. I think that all of us recognised that there were anxieties about that. The hon. and learned Member for Fife, North-East (Mr. Campbell) and my hon. Friend the Member for Wrexham voted for an amendment that tried to change the nature of the sterling guarantee, but I was much more minded—I think this is the Labour party's official view—by the argument that these discussions had been going on for some time, that there had been a negotiation process and that the people directly involved in those negotiations were happy with the proposals that had been made. They did not view them necessarily as ideal, but negotiations are always of that description and Ian Strachan, on behalf of the overseas civil servants, has made it clear that that was the best offer in town and that it was one that they were prepared to accept.
It is important to stress again that the guarantee is based on a pessimistic scenario, that it is in all our interests—not only all the political parties represented in the House but the people living and working in Hong Kong—that that scenario is never realised in practice and that we need to take a much more optimistic view of the way in which the system works.
I join the Minister in the words that he uttered at the end of his short speech: I put on record again our thanks to the people who have worked in the overseas civil service and to those who have worked for the Hong Kong Government. The success of Hong Kong, economically and politically, has depended greatly on the integrity and competence of those who have worked for the Hong Kong civil service. It is not without surprise that one hears time and again the comment that the rule of law, economic success and the civil service go hand in glove in Hong Kong. The Bill has given all hon. Members an opportunity to put on record our gratitude and our thanks, and the fact that we have a civilised rule of law that has operated so effectively in Hong Kong. One hopes that it will continue to operate so effectively after 1997.
We wish all those overseas civil servants well. There is an expression in terms of Hong Kong about the through train. I notice the anxiety on the Government ministerial Bench that the through train may not be working as effectively at the moment in terms of parliamentary

business, but I will come to a stop as we have moved from rail privatisation to the next issue. I am sure that other hon. Members will have an opportunity to speak before the franchisee passes on the baton to whatever Minister will reply to my hon. Friend the Member for Ashfield (Mr. Hoon). It would be a tremendous success for my hon. Friend if, in his maiden Front-Bench speech, he could not even persuade any Minister to have the courage to come to argue against him. I congratulate him on that.
We have supported this measure throughout. We gave a promise that we would not delay it. We have not done so and we welcome its implementation.

Mr. Menzies Campbell: I apologise to you, Mr. Deputy Speaker, and to the Front-Bench spokesmen for not being present when the debate commenced. I was at another meeting from which I found it difficult to tear myself away.
As the hon. Member for Leeds, Central (Mr. Fatchett), who spoke on behalf of the official Opposition, said, we had a most interesting and illuminating debate in Standing Committee, which was characterised by a genuine desire on the part of all the hon. Members who took part to arrive at the best possible decisions, in the interests of the people in whose interests the Bill has been conceived.
The stability and the dignity of the handover, which is to take place on 1 July 1997, will undoubtedly be enhanced by the quality of the civil servants and of the civil service which has characterised the administration of Hong Kong for such a long time. It is therefore right that those who have played such a prominent part in that administration should, so far as is possible, have their interests protected and preserved.
I am sorry that the hon. Member for Wrexham (Dr. Marek) and I were not able to persuade the Minister or any other member of the Committee of the virtues of the amendment that he moved and I supported. During the debate on that amendment, however, all Committee members recognised the need to ensure that the interests of those for whom the Bill has been conceived will be properly preserved, not only for now but in the future.
There is no doubt that these are complicated times in Hong Kong—if I may put it that way—as the date of the handover approaches, but there is little doubt that the Bill is a proper recognition of the contribution that so many people have made to the stability of the colony.
I am happy that the Bill should proceed unopposed and that it should receive Royal Assent as soon as practicably possible.

Mr. Hanley: With the leave of the House. I am grateful to the hon. and learned Member for Fife, North-East (Mr. Campbell) for his remarks and for pointing out that we had a vote in Committee. I know, however, that, the vote having been taken, the issue is now regarded as having been satisfactorily dealt with by the hon. Member for Wrexham (Dr. Marek) and, I believe, by the hon. and learned Member for Fife, North-East. It is good that the House should hear that. I am also grateful to the hon. Friend the Member for Leeds, Central (Mr. Fatchett) for the way in which the Bill passed its Committee stage.


As the Member for Leeds, Central said, the Bill has been examined in very fine detail. It now goes to the other place and, as the hon. Gentleman said, I hope that it will come back to this House unscathed and as quickly as possible, because the people for whom we are providing are the people whose contributions to Hong Kong have helped to make it such a flourishing place.
Hong Kong will continue to flourish, and it will be a great success story, up to transition and beyond. The Chinese believe that, we believe it, the world believes it, and Hong Kong also believes it—Hong Kong believes in itself. With the Bill we can reward those who have helped to make Hong Kong such a special place.

Question put and agreed to.

Bill accordingly read the Third time, and passed.

Orders of the Day — Copyright

The Minister for Science and Technology (Mr. Ian Taylor): I beg to move,
That the draft Duration of Copyright and Rights in Performances Regulations 1995, which were laid before this House on 20th November, be approved.
The regulations amend the Copyright, Design and Patents Act 1988 in order to implement all the main provisions of Council directive 93/98, which harmonises the term of protection of copyright and related rights to the European Union.
The directive became due for implementation on 1 July this year, and we very much regret that the complexities of the regulations have meant that we have been unable to complete the preparation in time to meet that date. Indeed, work still remains to be done on legislation to implement article 4 of the directive, which requires the introduction of a new form of protection for unpublished works in which copyright has expired. That article is therefore not covered by the present regulations. We intend, however, to deal with that remaining aspect as soon as possible.
The 1988 Act already complies with one of the main requirements of the directive, which is a 50-year period of protection for copyright in sound recordings and broadcasts and for the rights of performing artists. The directive should be of significant benefit in bringing the duration of those rights in the rest of the European Union to the same level as those in the UK, particularly in relation to the UK sound recording industry. That is an area of considerable economic importance to the UK and, up to now, the terms of protection have been much shorter in several other member states, including Germany.
The directive means, however, that the 1988 Act has to be amended to increase the basic term of copyright in literary, dramatic, musical and artistic works. It will increase from the present life of the author plus 50 years after his death to life plus 70 years. Although that term previously applied only in one member state—Germany—two other member states also had terms longer than those in the United Kingdom: in Spain the term was life plus 60 years and in France it was life plus 70 years in the case of musical works.
Harmonisation at life plus 50 years would therefore have been difficult because it would have meant protection reductions in three member states. The directive was, moreover, subject to qualified majority voting, and it became clear that most other member states were willing to accept harmonisation at life plus 70 years.
In those circumstances, the UK agreed, albeit reluctantly, to accept the increased term, although I know that there has been quite a lot of debate and controversy about that. It follows, however, that there will also be an increase in most other member states, and the United Kingdom's authors, composers and artists should benefit at least as much as those from other EU countries.
The directive also means that the duration of copyright in films, which is currently 50 years from the making or release of a film, is changed by the regulations and put on a similar footing to the terms for literary and like works. Copyright in films will now last for 70 years from the death of the last to die of the principal director, the authors of the screenplay and dialogue and the composer of any music made specifically for the film.

Sir Jerry Wiggin: As I have an interest in this matter, I hope to say a few words if I have the privilege to catch your eye later, Mr. Deputy Speaker. There is a differentiation between moving photographs and still photographs. If the Government are prepared to allow the special extension for films, why do they not extend it to still photographs? What is the difference between the two?

Mr. Taylor: My hon. Friend makes an important point, but the categorisation of "film" in the sense of video film was accepted as the basic definition for this purpose. If photography as such were to be considered an art form, that might bring it under aspects of copyright other than the particular element of video or visual presentations, which are generically called "films". I shall certainly consider what my hon. Friend has said in case there is a distinction that may have eluded me.
Copyright in films will now last for 70 years from the death of the last to die of the group of people consisting of the principal director, the authors of the screenplay and dialogue and the composer of any music made specifically for the film. The underlying reason for the change in approach is that several other member states already protect films on a life-plus basis rather than for a fixed period.
I should also like to explain that the directive requires that the increased copyright terms that it sets will apply not only to future works but to existing ones. That means that the copyright of works currently in protection in the United Kingdom will be extended. Revival of copyright will also occur in the case of works which, although in the public domain in the United Kingdom, are still protected elsewhere in the European Union. However, the terms set by the directive apply essentially only to works from the EU. Those from outside the EU will receive the term granted in the country of origin which, in most cases, will be less than the European Union term.
A number of the regulations relate to transitional provisions in relation to extended and revived copyrights. The Government are well aware of the difficulties that revival could cause, but without this approach there would be no effective harmonisation for a considerable time and UK sound recordings and performances would suffer from remaining out of protection in several other member states.
Moreover, we have tried to do as much possible to ensure that there are adequate safeguards to protect users who would otherwise be adversely affected by revival of copyright. Clearly, it would be wrong if anything done before the regulations came into force and copyrights revived were retrospectively to constitute an infringement of revived rights. That will not be the case, but, necessarily, the safeguards go much further. For example, where arrangements for exploitation of a work in which copyright will revive have been made before 1 January 1995, nothing done in pursuance of those arrangements after the regulations come into force will infringe the revived rights. That means, for example, that if a publisher has entered into commitments to produce an edition of an affected work before the date that I have announced, he will be able to fulfil his commitments without incurring any liability to copyright owners.
We have also had to establish who is to own extended or revived rights. That is not dealt with by the directive but has to be resolved, since otherwise it would be unclear

who is entitled to authorise particular works or to benefit from them, with the result that future use of works could be inhibited. On that aspect, we have tried to take an approach which is both fair and produces the greatest legal certainty. In essence, we have concluded that those objectives are best met by providing that the current owner of copyright will own the rights extended by the regulations and that the last owner of the original copyright will own revived rights.
The House will realise from this introduction that the directive raises difficult questions of balance between competing interests, which have to be addressed in the regulations. We have consulted widely on the legislation—first, through a consultation paper on the issues of ownership of rights and safeguards for users and, secondly, through a consultative draft of the regulations. In all, more than 200 different representative bodies, firms and individuals were consulted. I have also had many representations from colleagues who have taken a particular interest in the matter, and I am grateful to them for the cases that they have made—personally and on behalf of the organisations that they have introduced to me.
We are grateful for the detailed and helpful responses. Frankly, this is not an easy matter. Ultimately, it requires that a balance be struck. We have carefully considered all the points raised. I am confident that we have arrived at conclusions which are both fair and workable.
There is one further matter on which I should comment—the date on which the regulations are due to come into force: 1 January 1996. I am aware that there is concern among interested parties about whether that means that copyrights due to expire on 31 December are extended, as opposed to being revived. I assure the House that the effect of the regulations is that those copyrights will continue in force and be extended. The concept of time being continuous is very relevant. I assure the House that I have taken the most detailed instructions from my officials, whom I have cross-questioned on the matter, and they have satisfied me that the law—and the text—says exactly what it should say. I present the regulations for the attention of the House.

Mr. Geoffrey Hoon: I thank the Minister for his presence—and for his brevity, something that has sadly characterised too much of the Government's public contribution to this debate. As the Minister said, the regulations concern a complex and difficult area of law. Too often, the law relating to copyright is seen as a specialist subject of concern and significance to a particular and—possibly—rather narrow group of legal practitioners. Perhaps that feeling is reflected by the modest attendance in the House. Yet its importance underlies the entire provision of information and entertainment in this country. Without effective copyright laws, here and across the world, it is impossible to imagine how books could be commercially published, how music could be distributed and how films could be shown in cinemas.
Moreover, as the revolution in information technology gathers pace, copyright will become still more significant. As we move from mass media to the availability of films and music on-line and transmitted digitally into the home, effective copyright law around the world will be crucial. Copyright law will therefore be at the centre of a series


of commercial relationships, vital to the country's trading and financial interests, and vital to those who create, develop and distribute new ideas and information.
Although the Labour party will not be voting against the implementation of the draft regulations, Labour Members believe that there are significant problems with their content and, perhaps more significantly, with the timetable that has been followed. We have a series of concerns about the extent to which the draft regulations reflect the European directive on which they are supposed to be based and the fact that they are part of a comprehensive redefinition of the law of copyright in this country and at European level, to which I hope that the Minister will be able to respond.
I shall first deal with the timetable for the legislation. The draft regulations implement the European Union's duration directive, harmonising the term of copyright, which, if approved today, will come into force in this country on 1 January 1996, as the Minister said. The regulations are, as the Minister conceded, already six months late. Since the regulations are not amendable at this stage, we are left with the uncomfortable position of having to accept their general thrust—which we do—while not being able to make the necessary detailed amendments. In the interests of the greater good served by the regulations, we are at this stage prepared to accept them.
Having said that, it is important to place on record our reservations. In particular, why has it taken the Minister so long to lay the draft regulations before the House? He referred repeatedly to complexity, but a careful study of the timetable would be useful to Members. The regulations are based on a directive that was published on 29 October 1993. It took more than a year—13 months—for the Department of Trade and Industry to produce a consultation paper. That was produced on 5 December 1994. It was not the most sophisticated of documents, although I recognise that it was necessary to address certain questions.
The consultation paper, which as I said took 13 months to produce, simply asked a series of questions. It did not provide the answers—although it provided some guidance—yet it asked questions of those who were consulted. The consultation period went on for a further 12 months. The regulations were published on 6 December 1995. In my experience, draft regulations normally contain the precise date of publication. It is curious that in this case—Members will observe it if they look at the regulations—the regulations are somewhat coy about when they were published. It says that they were published in 1995. They were in fact published on 6 December 1995. I suspect that the reason why the precise date is absent is that the Government are embarrassed about taking so long to produce the regulations.
What that means to the House is that although the Department had some 13 months to issue its consultation paper—a series of questions without any particular answers—and then took a further 12 months to produce thè regulations, it has given the House eight working days to consider what the Minister has described as a complex series of proposals. Indeed, before the proposals come into law on 1 January 1996, the House has precisely 10 days in which to consider their complexity, debate them and reach a conclusion.
I would be perfectly willing to give way to the Minister if he wished to explain whether the reason for that was simply Government incompetence or a deliberate and

calculated snub to the House. That is a serious question, given that we have to consider these matters, complex as the Minister acknowledges, in eight working days, and have not been given the opportunity that his own Department was given to consider them over years. I shall gladly give way.

Mr. Ian Taylor: I reassure the hon. Gentleman and the House that no snub was intended, nor was there incompetence. There was, as I saw for myself, a whole series of very complex attempts at drafting the regulations, since their concept is not easy to express in succinct form in legislation. That is therefore what has taken so long—as well as my insistence that there was the widest possible consultation.

Mr. Hoon: I am grateful to the Minister for his observations. I am sure that the House appreciates the difficulty that he has had with the complexity of this matter. However, individual Members also have to wrestle with that complexity in reaching their views, which cannot be done satisfactorily in a short time.
I invite the Minister's comment on another subject. He mentioned the consultation repeatedly. That consultation has gone on for 12 months. The Minister told us that some 200 responses were received by the Department. Of course, none of those responses is available to Members. They are available only to the Minister, and therefore no one else knows what balance of representation was contained in those responses.
Would it not have helped the Minister's case enormously if, when he was explaining the rather short time that Members have to consider the regulations, the results of the consultation had been made available in the Library? Then, we could have seen how the argument had developed in the same way that he and his colleagues could. That would have meant that we would have had some idea how the different arguments developed in the preparation of the regulations.
The Minister candidly conceded that certain aspects of the directive were not covered by the regulations. Practitioners and others in this area are concerned that, notwithstanding that the terms of the directive have been available for more than two years, we still do not have a comprehensive enactment of those terms. Can the Minister say clearly when the entire directive will be implemented, including article 4, and when the other aspects of the directive not mentioned in the regulations will be laid before the House?
I hope that the Minister will answer that question because, as he has repeatedly reminded the House, the point of the legislation is the need for European harmonisation. As one of the Ministers most enthusiastic about Europe, he knows that the purpose of harmonisation is to ensure that we do not have different levels of protection in the legal systems of different member states. That was the reason for enacting the duration directive, yet the Government, after more than two years, are able to enact only part of that directive. I hope that the Minister will clarify the timetable for other aspects of the directive.
The Minister properly made reference to some criticisms that have been made of the implementation date. A number of organisations concerned about copyright, notably the British Copyright Council, have expressed their anxieties about the date on which the regulations will come into force. The Minister failed to explain why 1 January 1996 had been chosen.


The criticism made was that 31 December 1995 would have been preferable. That date would have allowed a new, longer period of copyright to apply to the United Kingdom works whose copyright protection will expire under the present law on 31 December 1995. Although such works will clearly be governed by the regulations, there is concern that they will be subject to the regime governing revived copyright. Had the directive been implemented by the due date of 1 July 1995, they would have enjoyed the additional protection conferred by extended copyright.
I am sure that all the organisations concerned will be pleased by the Minister's assertion that the change of date will not change the legal position. However, I should be grateful if he could explain precisely why 1 January was chosen rather than 31 December. In giving that explanation, the Minister would be able to reassure those affected by the regulations that his and his advisers' understanding of the position is correct.
There has been some concern that certain United Kingdom works—previously in the public domain, but now returning to copyright protection under the regulations—will qualify under United States legislation for the restoration of copyright protection, in the USA, to certain foreign works that had lost it for largely technical reasons. One of the principal, qualifying factors affecting that restoration is that the work in question must be in copyright in its home state on 1 January 1996. I hope that the Minister can reassure the British Copyright Council and all those whom it represents on that point.
On the essential question of duration, the importance of harmonising the laws across the European Union is clear. The Minister has made the case very well. However, it is equally important that that issue is considered in the context not simply of European law, but across the world. Now that we have achieved a degree of standardisation in the European Union, can the Minister explain what efforts the European Union will make to ensure that its new, longer period of duration is consistent with the law of copyright elsewhere in the world? Clearly, it is not sufficient simply to ensure that there is standardisation in the European Union when countries such as the United States may be heading in a different direction on duration.
Article 6 establishes that the duration of copyright in a sound recording remains unchanged at 50 years. I am worried that some difficulties may arise—from the difference between 50 and 70 years—that will affect sound recordings used in films. Copyright in films is an especially difficult subject, and the Minister touched upon it. Although many people talk rather glibly about film being a director's medium, directors are given only what are described as moral rights in a film under UK law, because of the way in which UK law has historically viewed rights in films.
The approach in this country is to grant copyright to the person undertaking arrangements for the making of the film. In practice, that has meant the producer or his production company. He makes a series of contractual relationships with writers, composers, directors and performers, with the result that the producer owns the film in a legal sense. Therefore, the common law solution to a series of distinct copyright problems in the complex business of making a film has been based on contractual

arrangements agreed between the different parties. However, the person who bears the financial risk—the producer—is placed in receipt of the ultimate financial reward, and therefore the copyright protection.
That approach, as the Minister knows, is in stark contrast to the continental approach, because other legal systems subscribe to a different philosophical view. Those systems consider the rights of authors as central to the definition of who bears the risk and receives the benefit in the creation of a film. Copyright in a film, therefore, is held jointly by the artistic elements in the film, and copyright law recognises the artistic contribution of a number of collaborators.
Most importantly, the directors benefit from that approach in continental law in negotiations with producers over contracts, for example in the assignment of rights and the length of time for which they are hired to make the film. The directors are in a much stronger position, and that inevitably means that those rights are reflected in the price paid for their services.
The European directive on duration provides that the principal director of a cinematographic or audio-visual work shall be considered as its author or one of its authors. Member states shall be free to designate other co-authors. As I understand it, it would be necessary to amend section 9 of the Copyright, Designs and Patents Act 1988 to implement that proposal in the United Kingdom. Unless I missed it, the regulations do not appear to do that, so notwithstanding the idea that the directive seeks to harmonise European law, it will simply create the considerable legal discrepancy that I have described. That is a significant problem with the regulations.
Under the directive, member states are free to designate further co-authors of films. Can the Minister tell us whether the United Kingdom intends to do that as well? It seems likely that other countries will designate as co-authors others such as writers, so surely that will multiply the differences in copyright law between different member states. The draft regulations touch upon that problem in the provision on the death of an author, which refers to the period of time after the death of named individuals who participate in the making of a film. If we are to establish a consistent principle across the European Union, it is important that we should act consistently on the rights of authors.
It is important to consider the implications of revived copyright. The change in the duration of copyright means that copyright will be revived for a number of different works currently in the public domain, and thus are no longer subject to copyright. I have seen various lists of the copyright holders who will benefit from that change—for example, those who hold the copyright on the work of James Joyce, John Buchan, Thomas Hardy and Rudyard Kipling. The list also includes Sir Edward Elgar and D. H. Lawrence, who once lived in what is now my constituency. All of the rights holders to those people's work will enjoy a benefit as a result of the implementation of the draft regulations. On a more serious note, the House should be aware that Adolf Hitler died on 30 April 1945, so any rights on "Mein Kampf' will be revived by the regulations.
Copyright protection will be restored to authors who died between 1925 and 1945. As the Minister said, the issue is who should benefit from the restoration of those


rights. The Writers Guild of Great Britain has consistently argued, perhaps not surprisingly in the circumstances, that revived copyright should vest in the author's estate rather than with the last copyright owner where there has been an assignment.
In a sense, revived copyright is a windfall—perhaps unlooked for when negotiations on assignment were conducted. It might be possible that revived copyright was anticipated when an assignment contract was made, but it is difficult to accept that argument. It is therefore at least arguable that the beneficiary of the windfall should be an author's descendants, because it could not have been imagined at the time of assignment that an extra 20 years of rights would subsequently become available. The Department of Trade and Industry has obviously considered that issue, and I would be grateful if the Minister could tell us in more detail than he spelt out in his opening speech why it decided that the benefit should go to those to whom the rights had been assigned rather than the beneficiaries under any will.
The revival of copyright has important implications for British heritage. It has been stressed to me that, in particular, the copyright on many works by British composers who died between 1925 and 1945 will be revived. The list includes not only Elgar, but Delius and Holst. In most cases, their estates are charitable trusts whose royalty income is spent on stimulating musical activity and the continuing development of British cultural life. With the anticipated rise in disputes and references to the Copyright Tribunal, as set out in the regulations, such income is likely to be depleted. That might also mean that proportionate income is not available to support and encourage today's composers and performers. The use of revived copyright works or arrangements could, however, pay for any loss suffered by those charitable trusts as a result of such legal disputes and legal costs. The extra income made available by revived copyright could therefore benefit the United Kingdom's cultural community, but that would not be possible by simply transferring rights to assignees.
At this stage, it might not be appropriate to study in great detail the detailed provisions governing rights in respect of revived copyright. The Minister must bear in mind, however, that the particular timetable he has chosen, which does not allow the House the time that it might normally expect to consider such regulations, means that we have not had an opportunity to table amendments—assuming the regulations to be substantive legislation—or to encourage the Minister to think again about certain aspects of the draft regulations.
The statutory licence regime has been subject to as much criticism as any of the other proposals contained in the regulations. That regime will reduce copyright in the circumstances anticipated to the right to remuneration as set by the tribunal, if not agreed upon. That is the cause of some concern because that regime appears to place the United Kingdom in a different position from Germany, for example, which offers a guaranteed right for the full 70-year period. I would be grateful if the Minister could provide us with more detail about the statutory licence regime, because the regulations revive a system that previous copyright legislation had abolished.
As I understand it, the regulations originally included a proposal that would have preserved the ability of composers and performers to object to recordings of their work and to prevent their performance. The Government

had given a formal undertaking that that right to object would be retained, but it does not appear in the regulations. The compulsory copyright licence system means that as long as a royalty is paid, the composer or performer of the original work will no longer be able to object to its further use. That is a matter of concern and it is unfortunate that the Government appear to have changed their mind in that respect. I am grateful that the Minister said that, in time, article 4 will be considered, and I hope that he will be able to tell us when that will happen.
We can expect to consider a number of items of legislation concerning the implementation of the European Union directive on copyright. It was always assumed that the directive would be implemented along with the rental and related rights directive. If the Minister and his Department have experienced difficulties with the relatively modest copyright directive, I anticipate that they will have still more difficulties with the rental and related rights directive. Can the Minister explain why those directives have been separated, and when we can expect the introduction of the rights and rental directive? Can he tell us whether, on that occasion, the House will have more time to consider its implications rather than the eight working days that we have been given to look at the copyright directive?
I am grateful to the Minister for his remarks, and I hope that the House accepts that, while a series of detailed criticisms can be made of the draft regulations, in general the proposal to extend the period of copyright to 70 years from the 50 years that have been standard in this country for many years, is appropriate. On that basis, Labour will not vote against the draft regulations.

Mrs. Edwina Currie: I declare a financial interest in the subject. Indeed, I am glad to say, it is a very substantial financial interest, as I have an income from writing, broadcasting and audio tapes. I should also put on record my thanks to the Minister for the fairness and courtesy with which he has dealt with this fiendishly complicated issue and the regulations which stem from it. I am particularly grateful to my hon. Friend for the way in which he met a delegation from the Writers Guild and others, which I organised on 18 July. All concerned were grateful to him, because he listened carefully to what they had to say.
Everyone I have spoken to on this matter is pleased to see the regulations, and nobody wants to delay them. I am glad to see that they are in print, and I have been asked to express appreciation to the Minister for his efforts. The matter has taken a little longer than we would have liked. Nevertheless, no one wants to delay it any longer.
Copyright is too often seen as an unreasonable cost or as a restraint on trade—in much the same way as product licensing and patents in, for example, the pharmaceutical industry and elsewhere. Legislation is frequently written from the producers' point of view, and that tends to be particularly true in the EU. In this case, the producer would be the publishers, and the publishing houses also have their views on the matter.
If there were no copyright, or if it were to be seriously damaged, it would be the creators who would be disadvantaged—the writers, photographers and scriptwriters. It is our duty to protect these people and their interests, and not necessarily always those with the


hefty contracts, such as one or two Members of this House and of the other place. We must protect the small earners who earn their living by doing such work. It is important that this House endeavours to protect those people.
A large number of points were made by the hon. Member for Ashfield (Mr. Hoon), but I wish to mention three main points. Some matters have been raised by the British Copyright Council, and I have passed those to the Minister. These are supported by the Writers Guild, and also by A. P. Watt, the oldest literary agents in the world, who happen to be my agents as well.
The three issues are: the date of implementation; what is meant by "arrangement"; and the missing six months from 1 July to 31 December 1995. On the first issue, the question of the date is very important. I heard what the Minister said, and I appreciate his assurances. Nevertheless, there is no good reason why 31 December should not have been chosen.
If the date were 31 December, rather than 1 January 1996, there would be two benefits. First, any author who died in 1945t—he hon. Member for Ashfield mentioned several such authors—would have the benefit of extended rather than revived copyright. Another reason—which is probably more important to living writers—is that the United States is restoring copyright in certain works which have fallen into the public domain in America under what is called "Restoration of Certain Berne and WTO works". This applies as from 1 January 1996 to works which are in copyright in the country of origin at that date, and some doubts have been raised as to whether there would be continuous copyright for works in which copyright has been revived on that very date.
I can well understand that the Department of Trade and Industry thinks that there will be no problems, but the fact is that certain lawyers who are active in this area and certain literary agents disagree strongly. The point has been made by my agent—why take the risk? Why chose a date which causes problems and concerns? If it is possible to get the date changed, that would be worth doing. I hope that when future directives and regulations on this issue are considered, we will get the date right. I dread to think what the costs could be for the Department of Trade and Industry if it gets the date wrong. Authors who lose a lot of money in the United States might decide to hold the Minister responsible.
The second issue concerns arrangements versus agreement. Under regulation 23, it will be permissible to continue to make use of works which are no longer in the public domain provided the
arrangements for the exploitation of the work in question
were made before 1 January 1995. The previous draft of this statutory instrument referred specifically to the need for the existence of "an agreement" in those circumstances.
The point is strongly made on this matter again by A. P. Watt. Linda Shaughnessy, the rights director of the agency, says:
It would be wonderful if somehow 'arrangements' can be clarified, especially for Clause 23(3) which relates to derivative works (someone making a film, for example, or quoting from a revived work in a biography of an author).
That happens very frequently.
At the moment they are only defined as 'arrangements for the exploitation of the work', which is open to wide interpretation. A plan to do something with a work but where no money (or an

insubstantial amount) has been expended should not count as an arrangement. Nor should a speculative venture where for example someone has spent time producing a screenplay without any commission.
This sometimes happens without any permission, either.
However, if a signed contract was in place by 1 July 1995—to write a screenplay, for example, or to write a biography—then to produce the film or quote from the work of the revived author in the biography should not be an infringement. If a substantial amount of money had been expended—perhaps expressed as a substantial amount of the total monies for that project—that might also count as an arrangement. Anyone claiming arrangements to have been made should be prepared fully to disclose documentation proving this.
The opportunities for litigation in such cases are legion, and it is important that this matter should be cleared up. The previous wording seemed to be acceptable to all concerned, while the current wording seems to raise doubts.
The third issue is the question of the lost six months, which is regarded as an omission in the statutory instrument. Copies of a revived work which were printed before 1 July 1995 are not considered an infringement, but copies printed after the commencement date may be published as part of the statutory licence. What happens to works printed on or after 1 July 1995 but before the commencement date?
A sensible interpretation would be to say that copies sold before the commencement date would not be an infringement, but copies sold after would be considered as licensed by right and subject to the reasonable royalty, provided notice has been given to the copyright owner of the revived material. This, however, is probably something that the Association of Authors' Agents and the Publishers Association could decide amicably themselves. It may well be that the Minister wants to express his view on this matter, and he should certainly be aware that the lost six months could cause difficulties.
That is all that I want to say, except to reiterate my gratitude to the Minister for the careful and delicate way in which he has stepped through this extraordinary minefield.
I wish him well for all of the material which has yet to come on the issue.

Mr. Austin Mitchell: I do not claim the literary skills of the hon. Member for South Derbyshire, (Mrs. Currie), nor the legal skills of my hon. Friend the Member for Ashfield (Mr. Hoon). Therefore, for both those reasons, I can be briefer than usual. I wish to raise a few points that have been put to me by the British Copyright Council, as advised by lawyers, and the British Photographers Liaison Committee.
I have no interest to declare, except that I am an enthusiastic amateur photographer who, with more pictures in the House of Commons photographic club exhibition than the hon. Member for Weston-super-Mare (Sir J. Wiggin), can claim greater expertise in this area. The implications of what the Minister said about the day that the regulations are to come into force were not clear. The problem is that the date affects works whose copyright protection expires under the present law on 31 December 1995. What exactly is the Minister telling us? The copyright of such works will presumably be extended, rather than revived. Am I correct in saying that?

Mr. Ian Taylor: indicated assent.

Mr. Mitchell: The Minister nods.

Mr. Taylor: As several colleagues have raised the point, I shall read out exactly what my legal brief says. I do not apologise for reading a legal brief because, ultimately, it is the lawyers who will have a field day with the regulations. The brief says:
"The increased copyright terms set by the Regulations will apply on 1 January 1996, that is on commencement to 'existing copyright works', that is to works in which copyright subsisted immediately before that date. Time is a continuum, and therefore there is no break between the point immediately before commencement and commencement itself. Consequently, I am able to reassure the House that the Regulations will maintain in existence, on and after 1 January 1996, those copyrights which subsisted on 31 December 1995 but would otherwise have expired at the end of that day. These copyrights will be thereby extended, and revival is not relevant to them."

Mr. Mitchell: I am grateful for that intervention although the Minister baffled me as much as Einstein's theory of relativity, on which he seemed to touch at times. The point is important because the rights of revived copyright owners are much weaker than those of extended copyright owners. The provision affects only a comparatively small number of people. Let us consider the author of a work or a photographer whose work was written or whose photographs were taken in 1945 and who died in 1945. My point is important for such cases.
If the United Kingdom had, as my hon. Friend the Member for Ashfield pointed out, complied with its obligation to implement the provisions by 1 July 1995, which we should have done, the problem would not have arisen. The people whom I mentioned would have been protected and the copyright would have been extended rather than revived. That point is important to a small number of people.
A further point is that the owner of a revived copyright will normally be the person who owned the copyright before it expired. In the case of photographers, the owner of the copyright could be a company. As defined under the Copyright Act 1911, the owner was the person who owned the photographs at the time the photograph was taken—in other words, the person who effectively employed the photographer. If the owner was a company that has ceased to exist, the problem is who owns the revived copyright.
That problem does not arise with film because the regulations give the revived copyright in those circumstances to the principal director or his personal representative. Why could the copyright for photographs not be given to the photographer and his or her personal representatives? All that would be required would be an amendment to paragraph 10 of schedule 1 to the Copyright, Designs and Patents Act 1988 to make the question of who was the author of a photograph determinable for copyright purposes. There is a difference between the treatment of photographers and the treatment of the directors of films. Perhaps the Minister will explain whether there is protection for photographers who were employed when they took the photograph by a company that has ceased to exist. Provisions of the directive remain to be implemented. The directive requires the principal director of a film to be named as the author or co-author. Why has that provision not been implemented for photographers? What will happen to that provision?
Although providing for the copyright period for films to be calculated in accordance with the directive, the regulations are silent on the relationship between that and

the current law, which provides for the copyright of a film to belong to the producer. The producer is not mentioned in the list of persons in regulation 6. Again, that point is relevant to photographers.
The directive requires the introduction of a 25-year term of protection for previously unpublished works that were first communicated to the public after the expiry of copyright. Clearly, that will be a source of controversy, as it was in the consultation period. Why has nothing been done about that?
The British Copyright Council has made the point, which I must put to the Minister, that the rental and lending directive and the cable and satellite directive have not yet been implemented. As those directives are relevant to the regulations, it would be useful to know what the Government's timetable is for those regulations, which are now 18 months overdue.
I am grateful for the opportunity to put those points, which are made in a spirit of questioning so that the Minister can give further explanation about the regulations, rather than in a spirit of hostility. My hon. Friend the Member for Ashfield said that he supported the regulations. I always defer to what my Front-Bench colleagues say in all matters and especially when there is a speaker who is as articulate as my hon. Friend. I support the regulations, but I believe that my questions need to be answered.

Sir Jerry Wiggin: I immediately acknowledge that, as the hon. Member for Great Grimsby (Mr. Mitchell) said, I am chairman of the all-party photographic group. I am also a member of the council of the Royal Photographic Society of Great Britain and I submit a number of my photographs to an agency in the hope that one day, somebody will buy one. I am remunerated for none of those interests, so they are not declared, but I feel that these days, I should mention them before proceeding.
Both my foxes have been shot. My hon. Friend the Minister made a clear declaration that the difference between revived and extended copyright would not be affected by the date of implementation. However, we heard a fairly sorry story of the progress of consultation on the directive from the hon. Member for Ashfield (Mr. Hoon). I am conscious of the difficulties of consulting and I believe that one of the problems when one consults a large number of people is that if one does not take their advice, they naturally feel affronted and feel that they would like a second bite at the cherry. That is especially true of photographers; I am speaking primarily with an interest in photography. They feel that their views were ignored while the film industry was dealt with graciously, as were, to a large extent, the authors.
After I made an intervention in my hon. Friend the Minister's speech, he got on to the extremely delicate point of whether photography is art. If we got into that debate tonight, the HMSO debate would go on to the early hours of tomorrow morning. I will not follow my hon. Friend down that line, but I ask him to take on board the fact that many people earn their living from taking and selling photographs, sometimes for many years, and depend on copyright laws and protection not only for their livelihood, but for their pension and for their families' wealth in the future. It is, therefore, extremely important


that the photographic side of the matter is got right, especially in a day and age when more and more images are being demanded by CD-ROM, by television and by all the other agencies of moving images. This matter will become more important, not less.
My second fox was shot to some extent by the hon. Member for Great Grimsby, who has read the same brief as I have; I shall not repeat word for word what he said. However, when dealing with corporate authors, will my hon. Friend the Minister answer the question why the director of a film should be able to pass on the rights in copyright, whereas a photographer who has worked for a company that has ceased to exist does not have a similar right? I have put the question simply although I know that none of those matters is simple.
I should say to my hon. Friend the Member for South Derbyshire (Mrs. Currie) that this is a serious matter. If she believes that if the Government have got it wrong, a united band of authors will be able to seek restitution in the courts, I must disabuse her of the idea. If the regulations go through—and they will, I suspect, because, in general terms, we do not want to throw out the baby with the bathwater—they will become law. The law of the land will be interpreted by the courts. It will be no good saying that we have got the date wrong; her author friends will have had it.

Mrs. Currie: People like me have the opportunity of a perfect revenge, because if the Minister gets it badly wrong, I can put him into one of my future novels.

Sir Jerry Wiggin: Having read my hon. Friend's novel, I think that it would depend upon which part of the novel he was put into. He might become famous. My hon. Friend once attributed the start of her career as an author to my interest in her affairs. I am glad to hear that she is doing so well out of it because I am not making any money out of photography.
This is an important matter to many people. I hope that lessons will be learned from the way in which the Government have treated the directive. The questions asked by the hon. Member for Ashfield about the sections that will be attached to it are equally important. I hope that my hon. Friend the Minister will take careful note of that, because so many livelihoods depend on the matter.

Mr. Robert Maclennan: I must begin by declaring that, as an occasional author, I might have some interest in this matter. Candidly, I am not entirely sure what the effect of the order will be as I have come late to the subject and am not an expert.
I echo what was said by the hon. Member for Ashfield (Mr. Hoon) about the way in which the matter has been handled. It is extraordinary to have nearly two years of consultation with as many as 200 people and organisations and then to leave the House of Commons so little time to consider it on a take-it-or-leave-it basis. That is not a rational way in which to legislate.
This is a complex area of law which could clearly have a widespread impact. The debate illustrates some of the general points about how not to amend the law of the land that were made last week in a debate, which I initiated,

on the legislative process. Unfortunately, we cannot go through the regulations one by one, deleting those that are unacceptable and accepting those that have not raised adverse comment. That is pretty close to disgraceful.
The fact that copyright is an arcane subject that interests directly only a relatively small number of hon. Members is no excuse for legislating in this fashion. If the Minister had been able to say that, following the consultations, a broad consensus had been reached and that the difficulties had been ironed out, we would perhaps have been able to nod the measure through with a greater sense that we were not being derelict in our duty. Alas, there is clearly discontent and dissatisfaction. Although the hon. Member for South Derbyshire (Mrs. Currie) is doubtless right that people want the law to be amended in broadly the direction of the directive, the uncertainties have given rise to criticism.
I have been asked to draw attention to the concerns of the Composers Estates Group and the Alliance of Composer Organisations. They fear that hardship will be caused, especially to the original authors and their heirs, by the proposed extension of the 20-year period of copyright. As I understand it, under the proposed regulations, ownership of the extra 20-year period would belong to whoever owned it immediately before the implementation date, 1 July 1995 or, in the case of revived works, the owner immediately before the copyright expired. In many cases, that would be the publisher, rather than the creator, of the work.
In the case of extended copyright, the creator's heirs will remain bound by what are in some cases out-of-date publishing agreements, often made several decades ago. The draft regulations do not allow them to be renegotiated or updated. In the case of revived copyrights, there is no obligation whatsoever on the publisher to pay royalties or to abide by any pre-existing contract.
The original European directive, which was published on 29 October 1993, was specific about the exploitation of works which were in the public domain under the old regulations but which became copyright under the new ones. It was intended that
persons who undertook in good faith the exploitation
of a work when it was in the public domain should not have to make royalty payments when the copyright in such work was revived. It is clear that that was not intended to apply to those who exploited works in bad faith.
The regulations ignore the reference to "good faith" and extend the immunity from paying royalties to anyone who is
in pursuance of arrangements made before 1st January 1995
according to draft regulation 23.
I have been informed by a lawyer who represents the Composers Estates Group that, "in pursuance of arrangements" is not a legal term of art and has no real meaning. It is sufficiently vague to have allowed anyone who exploited a copyright work after the publication of directive and before 1 January 1995—a period of 14 months—to go without paying a single penny in royalties. Such a lack of clarity is a loophole ready and waiting to be used by the unscrupulous to avoid paying royalties. Activities such as stockpiling may have been legally possible with no point of redress for the copyright owner and the potential loss of huge royalties. In this case, ignorance is a defence.


Dispensation from royalties should be granted solely to activities relating to revived works which were carried out before publication of the directive. Anyone exploiting, or arranging to exploit, a revived copyright work after the publication of the directive ought to be legally bound to have known that copyright was to be revived and that, therefore, royalties should be paid.
Draft regulation 24 states that the exploitation of revived copyright is to be subject to a compulsory licence. In practice, that seems to mean that someone who wishes to exploit a revived copyright needs only to give notice to the copyright owner of his intentions and he is then automatically licensed. He is required to agree with the copyright owner the payment of a reasonable royalty, but that does not have to be agreed in advance of the copyright being exploited. Draft regulation 24(4) states:
If he does give such notice, his acts shall be treated as licensed and a reasonable royalty or other remuneration shall be payable in respect of them despite the fact that its amount is not agreed or determined until later.
If the exploiter and the copyright owner cannot come to an agreement, the case has to go to the Copyright Tribunal. That can be cumbersome, time consuming and expensive. While that process is going on, the exploiter can enjoy the legal right provided by the regulations and the copyright owner is in no legal position to stop him. In essence, that means that the copyright owner no longer has an exclusive right to his property and is unable to refuse an application to exploit it, even if he considers the use inappropriate for whatever reason or if no agreement has been reached on the amount of royalties payable.
The Composers Estates Group has asserted that the United Kingdom will be the only member state with compulsory licensing. In other words, this is not an obligation that has been imposed on us by European law or for other such reasons. It is worth bearing in mind the faith that compulsory licensing was abolished in this country by the Copyright, Designs and Patents Act 1988.
I am also informed that someone may exploit a copyright in this country by informing the copyright owner under the compulsory licence rules. People are legally entitled to do so even if the copyright owner has not agreed to its exploitation, but that would be illegal in another member state, so someone trying to export a product that exploits copyright in that way could, theoretically, have the export blocked by another member state, which would directly contravene the treaty of Rome.
Those are serious objections to the regulations. If it were left to me to decide these matters, I would oppose them. I have no opportunity to move amendments to deal with those complaints, and the House has expressed a consensus that the greater good lies in not opposing the regulations. I am not even in a position to make that evaluation satisfactorily. Moreover, I recognise that strength of numbers is not likely to be with me on this occasion, which is not an entirely unfamiliar experience. I therefore reluctantly acquiesce on this matter, which is an example of how not to legislate.

Mr. Ian Taylor: As I suspected, this has been a technical debate about what I admitted in my opening remarks are complicated regulations.
I reassure the hon. Member for Caithness and Sutherland (Mr. Maclennan) that, although the consultation period threw up one or two positions that

were difficult to reconcile, by and large the responses from the many groups that have lobbied me over the past year have shown a broad consensus in favour of the regulations. Points of detail will always have to be worked out and some issues will have to be tested by the courts.
We were not happy with some points because this measure was effectively achieved by qualified majority voting in the European Union. It was agreed that a timetable would be harmonised, but no detailed instructions were issued in the draft directive on how some measures needed to be carried out. Differences will therefore occur between member states, as have occurred in several different areas in this category.

Mr. Hoon: Is the Minister suggesting that, where measures are enacted by qualified majority voting, that justifies a member state enacting different legislation from that enacted in other member states?

Mr. Taylor: With great respect to the hon. Gentleman, who is normally a great expert on such matters, that is not what I meant at all. I meant that, when a measure is agreed by qualified majority voting, one must take an element of rough with the smooth because we considered the overall purpose to be beneficial to this country, particularly in the area of sound broadcasting. Furthermore, the directive is not so intrusive that it goes into every area on which every member country must regulate. In those circumstances, different member countries have gone down a slightly different route in applying the regulations.
I admit that we are late in applying the regulations—I apologise to the House for that—but we are not at the tail of the pack. Other countries are still wrestling with the problems and are having difficulties, as we had attempting to put the directive into proper UK regulations. It is my job not to second-guess other countries but to try to lay a comprehensive group of regulations before the House, which is what I have attempted to do.
I would test the patience of the House if I went through in detail all the questions that have been asked of me, but I shall attempt to deal with some of them. The hon. Member for Ashfield (Mr. Hoon) and my hon. Friend the Member for South Derbyshire (Mrs. Currie) asked about United States law. We cannot definitively interpret US law, but we understand that the restoration of copyrights provided for by US legislation to implement the trade-related aspects of the intellectual property rights agreement under the general agreement on tariffs and trade depends on eligible works being protected in their source country on 1 January 1996. We believe that our legislation will be in force on that date and UK copyright owners should be able to obtain any restorations of copyright in the US to which they are entitled. I have asked our team to be certain about that, and I am assured that it is.
Other aspects of the directive, such as article 4, need to be implemented and we shall return to that as soon as possible in the new year.
The hon. Member for Ashfield asked about ownership of revived rights. That is inevitably a complex area and a decision had to be made. Authors will benefit from the increased term in the case of future works by virtue of being the first copyright owners. We had to identify exactly who, in all simplicity, should receive revived rights and we decided that it should be the last owner of those rights.


I was asked about musicians' estates. By any reading of the regulations, if an original composer or author does not benefit, it is because at some stage they or their estate transacted those rights to someone else. They are not being denied their rights; we have gone for simplicity and determined that that is the way to proceed. Those who will benefit from the revived rights should be the last owners.

Mr. Hoon: Is the Minister entirely happy that the revived rights payment system is consistent with legislation enacted elsewhere in the European Union and, moreover, with the general principle applied in Germany, for example, where exclusive rights are guaranteed for a 70-year period? After all, that period was chosen because Germany gave greater rights than other countries in the European Union. The system for revived rights set out in the regulations does not give copyright holders exclusive rights for 70 years but simply provides a system of remuneration, subject ultimately to the Copyright Tribunal, for an extended period of 20 years.

Mr. Deputy Speaker (Sir Geoffrey Lofthouse): Order. That is a long intervention. It is more like a second speech. I call Mr. Ian Taylor.

Mr. Taylor: I was beginning to worry about that myself, Mr. Deputy Speaker.
I cannot second-guess the German position. As the hon. Gentleman said, there is no such thing as revived rights in that context in Germany because of the 70-year period. The Copyright Tribunal must tackle certain questions. The hon. Member for Caithness and Sutherland remarked on the tribunal. Although it may not be perfect, it is a tried and tested way of proceeding. It is not for the Government to second-guess what a reasonable payment might be in those circumstances. It would be extremely dangerous for us to go on to that ground, which is why the tribunal pronounces on such matters.
We have never proposed a right to object to the use of a work. Our consultative document included a licence of right, as do the regulations that have been laid before Parliament. If my memory serves me right, that assumption applies to any arrangement entered into before 1 January 1995.
The issue of film authorship has been raised more than once. We are deferring the implementation of that provision until 1 January 1997. We intend to introduce the change when the so-called "rental" directive is implemented, which we aim to do in the near future. We also intend that the producer of a film will remain one of its authors in the United Kingdom. We do not intend to go further, and the directive does not oblige us to do so. The Commission did not say that total harmonisation of film authorship should be achieved between member states, and the directive does not proscribe that.
My hon. Friend the Member for South Derbyshire asked about arrangements for timing. Regulation 23(2)(a) provides for acts done in pursuance of arrangements made before 1 January 1995 to be carried out without infringing revived copyright. We believe that it is only right that people who have made arrangements before that date should he allowed to carry out acts consequent on them without liability to ownership of revived rights.
A wide variety of circumstances may occur and the wording of the regulations must, of necessity, be fairly general. We do not consider it possible to define precisely the kinds of acts that will be permitted. When a dispute occurs, it will be for the courts to determine whether what has been done is genuinely in pursuance of the arrangements made before the specified date. The terminology concerned has been used in copyright legislation before—in transitional provisions in the 1988 Act, for example.
If necessary, my hon. Friend the Member for South Derbyshire might read section 57(1), section 180(3) and schedule 1(6) of the Copyright, Designs and Patents Act 1988. I say that because I know that lawyers will involve themselves in that matter anyway, and they might as well do so now.
The hon. Member for Great Grimsby (Mr. Mitchell) and my hon. Friend the Member for Weston-super-Mare (Sir J. Wiggin) mentioned the vexed question of photographers. In no way was I attempting, nor shall I now attempt in any sense, to become involved in the difficulties of trying to define photography. It is both a profession and an art form and the two co-exist happily, but that is not the question.
The question is whether a photographer is an author in relation to the regulations. I am assured that, in that context, author does mean author as defined in section 9(1) of the 1988 Act, and that that includes photographers. I hope that the photographers in question are happy with that.

Mr. Austin Mitchell: Photography is, of course, an art form as practised by myself and the hon. Member for Weston-super-Mare, but it is also—which is more important—a living. The question therefore arises, what happens when the owner of the copyright is a company that has gone bust? Why does not the copyright revert to the photographer or his legatees or whatever, in the same way as it does for the director of a film?

Mr. Taylor: The hon. Gentleman asks a question that I am unable to answer because I am unable to second-guess the legal position. Presumably there are circumstances in which such a right might revert to the previous owner, such as when the contract made to pass on the right to the company that went bust has fallen into desuetude. In those circumstances, it will be a question for the courts to test. I must stick to that position otherwise I should be making up law on the Floor of the House, which is a dangerous thing to do.
In my opinion, the main questions that have been asked show how difficult the regulations are. Far from wasting time, we have used our time constructively to obtain a wide range of reactions from various groups.
I admit that, in the end, Ministers and Departments must make a decision. We have made a decision, and we have laid the regulations before the House. I am delighted that the matter was chosen for debate on the Floor of the House.
I am grateful to my hon. Friend the Member for South Derbyshire for her encouragement and for the compliments that she paid on behalf of the Writers' Guild of Great Britain, of which she is an esteemed and honourable member—[Interruption.] Well, she is not a member, but she is a writer. I am slightly concerned that,


as a result of the debate, I am to feature in some position or other in her next novel. Before I get myself into further difficulty, I shall commend the regulations to the House.

Question put and agreed to.

Resolved,

That the draft Duration of Copyright and Rights in Performances Regulations 1995, which were laid before this House on 20th November, be approved.

Orders of the Day — DELEGATED LEGISLATION

Mr. Deputy Speaker (Sir Geoffrey Lofthouse): With permission, I shall put together the motions relating to delegated legislation.

Motion made, and Question put forthwith, pursuant to Standing Order No. 101(6) (Standing Committees on Delegated Legislation),

RATING AND VALUATION

That the draft Non-Domestic Rating (Chargeable Amounts) (Amendment No. 3) Regulations 1995, which were laid before this House on 30th November, be approved.

TAXES

That an humble Address be presented to Her Majesty, praying that the Double Taxation Relief (Taxes on Estates of Deceased Persons and Inheritances and on Gifts) (Netherlands) Order 1995 be made in the form of the draft laid before this House on 16th October, in the last Session of Parliament.—[Mr. Freeman.]

Question agreed to.

Orders of the Day — EUROPEAN COMMUNITY DOCUMENTS

Motion made, and Question put forthwith, pursuant to Standing Order No. 102(9) (European Standing Committees),

INTEGRATED POLLUTION PREVENTION AND CONTROL

That this House takes note of European Community Documents Nos. 9491/93 and 7511/95, and of the unnumbered Explanatory Memorandum submitted by the Department of the Environment on 2nd June 1995, relating to integrated pollution prevention and control; welcomes the Common Position achieved on this proposal on 22nd June; regrets the inclusion of certain activities in the Directive's scope, such as intensive livestock farming, food production and some industrial sectors, which do not readily lend themselves to this integrated approach; but congratulates the Government on the Common Position as a whole, which will secure the application in Europe of an innovative British approach to pollution control.—[Mr. Freeman.]

Question agreed to.

Orders of the Day — HMSO

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Freeman.]

The Chancellor of the Duchy of Lancaster (Mr. Roger Freeman): Anyone with a working knowledge of the House or of any Department of Government, will know that Her Majesty's Stationery Office has a long and illustrious history. It is one of the oldest Government Departments remaining in existence.
In 1786, a Treasury official called John Mayor suggested that the Government might make substantial savings if they bought all their paper and stationery through a central source. As a result, Her Majesty's Stationery Office was established as a small office fulfilling precisely that role. In all its activities since then, it has continued to honour that founding purpose by providing its customers with a cost-effective and high-quality service.
From such humble origins, HMSO gradually expanded into many other sectors, including printing and print buying, all aspects of publishing and supplying stationery, office equipment and furniture. In many of its activities, it came to represent a single, authoritative and trustworthy supplier to government and, in return, HMSO has been assigned many functions vital to effective government in this country.
For more than 100 years, HMSO has acted as printer to Parliament and, as hon. Members are of course aware, has also provided a service of the highest quality and efficiency, which is vital for the effective conduct of business in the House and the other place.
Much of HMSO's official printed output has, since 1882—

Mr. Patrick Thompson: I am grateful to my right hon. Friend for giving way so early in his remarks, but while he is doing a historical survey of HMSO, and bearing in mind HMSO and Hansard's very strong connections with Norwich, will my right hon. Friend make crystal clear his commitment to future jobs in Norwich? Will he also express his determination that there will remain a very strong presence for HMSO in Norwich in future, as there has been in the past?

Mr. Freeman: I am well aware of my hon. Friend's attention to his constituency duties, and I am able to give the following assurances about employment prospects: first, that Ministers will continue to consult the trade union representatives of the work force; secondly, that I can confirm that there are no plans for compulsory redundancies at HMSO in Norwich or anywhere else in the period running up to the proposed sale of the business; and, thirdly, that the provisions of the Transfer of Undertakings (Protection of Employment) Regulations 1981 will apply. Incidentally, the provisions of TUPE are not time-limited. As far as a buyer is concerned—

Mr. Martin O'Neill: I am grateful to the Minister for giving way at this early stage, but surely he is aware that, after 90 days, the requirements of TUPE are over and that there is no commitment on the part of an incoming employer to honour the undertakings laid down by his predecessor for any longer than that period.


The Minister should check with his officials, because that is the position, and there is chapter and verse in industrial relations law at present to show that that is the case.

Mr. Freeman: The provisions of TUPE apply, obviously, at the point of transfer of an undertaking from one owner to the other, and the owner is bound by those provisions. If an owner seeks to change and negotiate changes in the terms and conditions that apply to the work force of the business, the usual procedures for negotiations apply.
Perhaps the House will permit me to complete my answer to the first intervention, I inadvertently gave way a second time during my answer to the first intervention.
Finally, as I assure my hon. Friend the Member for Norwich, North (Mr. Thompson) that, in searching for an acceptable purchaser of the business, we shall seek to select a company that wishes to, and has clear and acceptable plans to, expand the business of HMSO.
No Minister can give any assurances about the total level of employment or the nature of the operations of any public or private sector organisation in future, but I hope that my hon. Friend is satisfied with those four very clear assurances of our policy.

Mr. Andrew Miller: Further to the question to which the Minister has just responded, is it not the case that, the day after the change of ownership, the new employer can give contractual notice in respect of any term and condition of employment? Given that that is so, is the Minister therefore saying that he is guaranteeing, in the sale arrangements, a commitment that any future purchaser would have to give something stronger than the basic contractual requirements? Is he saying that a term of the sale will be something that guarantees that changes will not take place in contracts of employment?

Mr. Freeman: I would not use the word "guarantee". I said that, in seeking a purchaser for the business, we shall look for a company that wishes to expand the business, and therefore the job prospects. I did not say that we would either seek or expect guarantees from any company. If HMSO were to remain in the public sector, I could not guarantee what jobs would be retained. I have already forecast that if HMSO remains in the public sector, its business and its employment base will contract.

Mr. John Garrett: Why?

Mr. Freeman: For the very simple reason that the business of government is reducing. I am sure that the hon. Gentleman is aware that, in the past 10 years, the work force of HMSO has contracted very substantially; it has halved in the past decade. That contraction is primarily a function of the reduced volume of turnover available to HMSO within the public sector.
Since 1882, much of HMSO's official printed output has had the unique legal privilege of being conclusive evidence of the matter stated and it is frequently relied on in the courts. By the end of the decade, HMSO had assumed formal responsibility for overseeing legislative printing and the then controller of HMSO and his successors were appointed as Queen's or King's printer in pursuit of that function. From that time, the controller

has also administered Crown copyright on behalf of the sovereign and, by agreement with the House and the other place, he also administers parliamentary copyright. In discharging those functions, HMSO has demonstrated and enhanced its reputation for diligence and reliability, which is now well known across the public sector and beyond.
The parliamentary and statutory publishing business accounts for about 10 per cent. of HMSO's total turnover. HMSO has always relied substantially on its original activities of supplying its customers with the essential requirements of administration—for example, printing services, office equipment and stationery. HMSO naturally brings to that work the same reputation for high quality and service. Since its founding days, it has been guided by the need to minimise the overall cost to the Government, and therefore to the taxpayer, while maintaining the standards that its customers have come to expect. That objective has guided the Government's policy of reforming HMSO in the past 15 years and it must clearly be paramount in any decisions taken about its future.
For the greater part of its history, HMSO's services were funded by means of an annual vote from Parliament. HMSO's supplies were, in accountancy terms, an allied service. Therefore, its customers did not have to draw on any of their voted funds to pay for the goods and services that they received. They effectively received them free. Although they benefited from HMSO's purchasing expertise and the savings that are inevitably made when buying in bulk, there was no incentive for them to look for a better deal elsewhere. Similarly, there was no pressure on HMSO to ensure that it offered the best deal.
As alternative suppliers became increasingly available for most HMSO services, it was clear that more could be done to ensure that the cost to the taxpayer was minimised. For those reasons, in 1980 HMSO became one of the first of the Government's trading funds. That meant that, for the first time, it had to cover all its costs through customer charges rather than through an annual vote of cash. In return, it gained considerable management freedom over operational and finance matters.

Sir Patrick Cormack: Does my right hon. Friend concede that, from that point, the price of Hansard has increased to such an extent that people can no longer afford to buy it? That was a direct consequence of the Government's decision.

Mr. Freeman: That was correct at the time. However, I am delighted to inform the House that, as a result of negotiating a new service agreement and of HMSO's responsiveness, the price of Hansard is now falling. I hope that the price not only of Hansard but of other documents supplied to the House and to the other place will continue to fall. That is a function of greater efficiency at the stationery office—I congratulate the management and the staff—and of a tougher and more businesslike attitude on the part of the House and the other place regarding the supply of documents.

Sir Patrick Cormack: My right hon. Friend knows that I am very displeased with the general plans to privatise HMSO. Do not his comments illustrate the good sense of keeping the publication of parliamentary papers properly within the control of Parliament? Is it not impossible to guarantee that if the work goes to a wholly free-standing commercial operation?

Mr. Freeman: I agree with the first part of my hon. Friend's statement. Parliament must control the supply of those immensely important services; I do not dissent from that view. I believe that the House will have greater powers than it has at present through the negotiation and execution of a contract between it and the supplier of the services. The powers would be formalised. I do not believe that any successful purchaser of all the printing, publishing and other allied business of Her Majesty's Stationery Office, as it is now called, would seek to renege from, diminish or belittle the importance of the services that it provides to the House. The contract will be extremely important and I believe that Parliament will be able to control it better than at present.
I am aware of my hon. Friend's concerns in that regard. Although I believe that it would be commercially unattractive to separate the parliamentary from the Crown business, as my hon. Friend has pressed me on that point I shall certainly reflect further on the matter. It may be that, on reflection, I shall decide that some arrangements could be made, but I offer no immediate prospect of a satisfactory solution.

Mr. Tam Dalyell: The Minister said that Parliament could control the business better. What methods does he have in mind to ensure that?

Mr. Freeman: I explained to the House that, for the first time in the history of the relationship between Parliament and Her Majesty's Stationery Office, there is now a formal service agreement. That was signed last week and it will come into effect on 1 January. There is a similar agreement with the other place. It is envisaged that the authorities of the House will enter into a formal contract on behalf of the House with the supplier of those services, in the same manner as many other services to the House—which perhaps are not as significant, but which are subject to normal commercial contracts. I believe that the existence of a public document that specifies the nature and the quality of services, together with the price of those services, represents a better mechanism through which the House can control the supply of the services.

Mr. O'Neill: In the event that HMSO is unable or unwilling to comply with the undertakings into which it enters, what powers will the House have to excise any damages or compensation from the printer?

Mr. Freeman: It depends on the provisions of the contract. The House may wish to have the right to veto any change in ownership or to inscribe damages into the contract or it may wish to remove the business of printing Hansard from other printing and publishing business. That is the nature of a commercial contract.

Mr. Nigel Waterson: Is it correct that the contract could specify that any future change in the operations of the buyer should be subject to the requirements of Parliament? Although parliamentary business may constitute a relatively small proportion of the new operator's turnover, from a commercial point of view it would be under a great deal of pressure to maintain a good relationship with the House and the other place because any failure to fulfil its requirements could jeopardise the rest of its business.

Mr. Freeman: It must be right that the dozens of private sector companies that supply services to the House

and the other place seek to retain their good name and maintain their business with the Palace of Westminster and both Houses of Parliament. I am sure that the same will apply a fortiori to the supply of printed documents.

Mr. Garrett: If HMSO breaks its contract, all we can do is sue it. Surely the Government should put those requirements into the tender document in the first place.

Mr. Freeman: I disagree with the hon. Gentleman. It is a matter for the House and not for the Government. [Interruption.] One may laugh, but, although I shall be responsible for the contracts placed by the Crown with the printer and publisher supplying documents, the precise contractual arrangements are a matter for the House. Speaking on behalf of the Crown, I would envisage that any contract for the supply of such important documents as White Papers, Green Papers and other statements of Government policy would include extremely tough contractual provisions.

Mr. A. J. Beith: Let me make it clear on behalf of the House of Commons Commission, first, that the service agreement that the Minister has described is entirely independent of the discussion about privatisation and comes into force on 1 January as a result of work already done. Secondly, on behalf of the House, the Commission would expect to reserve the right to make whatever arrangements seemed appropriate if there were any default on the contract by a private organisation that took over the duties of HMSO.

Mr. Freeman: I quite accept what the right hon. Gentleman said and I agree with him.
Shortly after 1980, customers—Government Departments—were freed for the first time from the requirement to deal with HMSO and were permitted to use any supplier that offered them the best deal. The results were dramatic. The commercial imperatives placed on HMSO meant that costs fell sharply after it attained trading fund status. That could only be good news for customers. Not only were they now free to shop around but they benefited from the savings passed on by HMSO as a result of its new-found commercial freedom.
That commercialisation also exposed HMSO to true competition for the first time and the private sector was quick to seize the opportunity. Central Government were and remain an attractive market for many of the services provided by HMSO, which soon had to compete with suppliers that were well used to the rigours of the marketplace and, more important, were not bound by the same public sector regulations as HMSO. In retrospect, the management and staff of HMSO rose to the challenge remarkably well and, despite that intense competition, HMSO remains the clear market leader in the supply of printing and stationery to central Government.
Ultimately, however, that competition will work against HMSO if it remains in the public sector. For instance, its governmental status means that it is still bound by restrictions on the prudent use of taxpayers' money, which ultimately accounts for nearly all its income. That rules out decisions that would carry only normal commercial risk in the private sector. It is unable to raise investment capital in ways open to private sector business or to diversify into new markets. Most important, it cannot trade with private sector customers when its own central Government market is in decline.


In such an environment, HMSO would clearly struggle to maintain its position. Although it has generally continued to meet the financial targets that it has been set, its turnover has declined by some 10 per cent. since 1990. A continued cost-cutting programme has led to the reduction of staff numbers by some 600 over the same period. To allow matters to continue in the same vein would be a gross disservice to the management and staff at HMSO, whose efforts have built on the organisation's formidable reputation and who in recent years have found their futures in jeopardy through being unable to compete fairly with other suppliers.
At the same time, to return to the old way of a protected market into which customers were tied would deny those customers and the taxpayers the benefits that they have gained since 1980. It would also imply a wholly unjustifiable lack of confidence in the ability of the management and staff of HMSO to run a prosperous, competitive business.
As I announced in the House last week, we therefore plan to privatise HMSO by means of competitive tender offer. That will allow the business to compete on equal terms with the private sector for the first time. It will be able to trade into wider markets and to diversify and expand as business opportunities present themselves. It will be able to raise funds for investment through all the channels open to private business, rather than having to apply to the Treasury. All those improvements will allow its customers to benefit from further efficiency savings and, as nearly all of them are at present funded from taxation, that will also benefit the taxpayer. At the same time, working in a more secure and prosperous environment will naturally present its staff with a more secure future.
I am convinced that, without privatisation, the business will continue to decline and its staff will face continuing job losses.

Mr. Mark Robinson: Is it not fair to say that HMSO is a centre of excellence that will attract a prospective purchaser and that, far from wanting to destroy the business, any prospective purchaser will want to keep the management team together and build on that business?

Mr. Freeman: I agree with my hon. Friend. I take a constructive attitude to the future of any business which has built its success, albeit in a declining public market, on not only its integrity but its hard work and its skill in obtaining business from Government and Parliament and discharging its function satisfactorily.

Mr. Patrick Thompson: I am grateful to my right hon. Friend for giving way again, but, as he is referring to the hard work and the skill of the staff of HMSO, many of whom live in Norwich and the surrounding area, will he respond to the particular point I made earlier about the importance of maintaining a strong base for HMSO in Norwich? That is traditionally so and I believe that it should continue. Can my right hon. Friend make a commitment to that?

Mr. Freeman: As I said to my hon. Friend earlier, I cannot make any forecast about how a business is organised into the future. However, having visited Norwich

twice—I intend to do so again to discuss the future with management and representatives of the staff—it is clearly the sensible headquarters of the business and I know of no reason why there should be any change in that regard. I cannot forecast how the nature of the business of HMSO will change the individual loadings of specific factories or depots in future. Norwich is clearly the centre, and I see no good reason why that should change.

Sir Patrick Cormack: I am particularly grateful for the assurance that my right hon. Friend gave me earlier, but surely any internationally based company could buy HMSO and produce from wherever it wished to produce and that is the blunt fact. I would not begin to impugn my right hon. Friend's good intentions or integrity, for which I have the highest possible regard, but he cannot guarantee it.

Mr. Freeman: Like many hon. Members, I spent the majority of my life in business in the private sector, subject to the rigours of the private sector. One locates businesses where that makes the most economic and business sense. I pay tribute to the management of HMSO for doing that and reorganising the business. Of course I cannot give my hon. Friend any assurance about where and how the business will be organised in future. I cannot do that with HMSO in the public sector, let alone the private sector. For the business to expand, it must be given the opportunity to compete for private sector business which I believe is available, and that must load its existing factories, if they are efficiently organised and located, which is clearly the case. That will enhance job opportunities.

Mr. Gerry Sutcliffe: I recognise that the Minister is accepting interventions; but, to pick up the point made by the hon. Member for South Staffordshire (Sir P. Cormack), the right hon. Gentleman cannot give guarantees, yet he has tried to do so in letters to Madam Speaker and to the work force of HMSO. The Minister has also accredited and applauded the workers and management of HMSO. Does he expect a management buy-out?

Mr. Freeman: No. There is no sign of any interest on the part of the management and staff, I suspect partly because of the size of the operation. It is a significant industrial operation and one would not normally expect a management buy-out. To return to the first part of the hon. Gentleman's intervention, I cannot give guarantees about the size of the work force of HMSO in the public sector and nor can the right hon. Member for Bishop Auckland (Mr. Foster), who leads for the Opposition and to whom I give way.

Mr. Derek Foster: May I press the right hon. Gentleman on his statement that the public sector market is in decline? He says that the central Government market is in decline, and that may well be the case for the time being; but the public sector market is far wider than the central Government market, and the right hon. Gentleman has not yet been able to privatise the entire public sector.
Does the right hon. Gentleman take account of the fact that we now talk in terms of the public sector's being the whole European market? As I understand it, HMSO has done little in the way of marketing throughout Europe. Will the right hon. Gentleman bear that in mind when he makes statements in the future?

Mr. Freeman: The right hon. Gentleman is right. The public market, as broadly defined, is enormous. However, private sector companies could bid, for example, to print the journals and other documents of the European Parliament and the European Commission; bidding is not restricted to HMSO. I should like HMSO in the private sector to compete vigorously for that business. As a matter of policy, I do not want a public sector body, funded and ultimately guaranteed by the taxpayer, to compete for business outwith the United Kingdom public sector when other companies can compete with that business. I am confident that, given its reputation and expertise, HMSO will be able to expand its business into the European public sector when it is privatised.

Mr. Peter Mandelson: I am grateful to the right hon. Gentleman for giving way again. He has been very patient.
May I pursue the point that the right hon. Gentleman made to the hon. Member for South Staffordshire (Sir P. Cormack)? He said that he could give no assurances about the location of production in the future. I wonder how that squares with his response to questions from hon. Members on 13 December, when he said:
We, as the customers—that is to say, the Crown and Parliament—can require the business to have a certain nature and structure … Parliament will be able to control the nature of the business that supplies the products."—[Official Report, 13 December 1995; Vol. 268, c. 993.]
Is the right hon. Gentleman not flatly contradicting what he said only last week?

Mr. Freeman: I was referring to HMSO's entire business. Parliamentary business represents 10 per cent. of the total. When I was questioned about the parliamentary press, I said that the contract written by Parliament could stipulate that the work must be done at the parliamentary press works—which is, in fact, a misnomer: the press prints more than just documents for the two Houses of Parliament, but that is not inconsistent with—

Mr. Mandelson: That refers to the location.

Mr. Freeman: Yes, but I was making the point specifically in regard to the parliamentary business and the parliamentary press. If the hon. Gentleman is asking, by implication, whether the Crown—that is, various Departments—would wish to stipulate when writing contracts that certain documents must be printed in certain cities, let me tell him that I do not consider that appropriate. We would look for a contract with the stationery office that offered good value for money in comparison with the alternatives; how that was organised would be a matter for the stationery office. There is one exception, however. If the hon. Gentleman does me justice and reads all the evidence that I gave to the Select Committee on Finance and Services, he will realise that I was dealing with that specific problem. Indeed, I provided even more assurances in response to the intervention by my hon. Friend the Member for South Staffordshire (Sir P. Cormack).
Accordingly, I propose to invite offers in the new year for the whole business, apart from a small residual body to deal with necessary public responsibilities such as Crown copyright. I plan to make a written statement on Government policy for Crown copyright by early February. The sale process will allow full screening and

evaluation of all bids and consultation with customers, principally Parliament. It should also allow for legally binding contracts to be drawn up between customers and the privatised business.
However, as I confirmed in my statement last week, I am not setting deadlines. There is a prerequisite that Parliament be satisfied—although I am also anxious for the uncertainty to last no longer than is absolutely necessary. It would make little commercial sense for us to withhold any of HMSO's operational businesses from the sale. Many of them are mutually dependent, and all benefit from the independence and integrity of HMSO, which I am keen to preserve after the sale. In particular, however, I note the suggestion of some hon. Members that the parliamentary press should not be sold, and could perhaps be taken over by the House. I have already responded to the intervention of my hon. Friend the Member for South Staffordshire.
Hon. Members have also previously suggested that HMSO should be freed from all its current public sector operating constraints yet be retained in the public sector. The right hon. Member for Bishop Auckland advanced that argument, and I am sure that he will do so again this evening. The commercial freedoms that HMSO would need to compete with the private sector in new markets are incompatible with its continuing in the public sector. The first commercial freedom is the right to borrow without the burdens of public sector constraints. No Government could countenance the prospect of a public sector body's having normal commercial freedoms to borrow.
The second commercial freedom is the right to win customers in any market, public or private. If HMSO as a public sector body were allowed such freedom, its competitors in the private sector would be bound to suspect unfair competition, especially if HMSO were able to borrow money cheaply because its activities were thought to be underwritten by the taxpayer. It is far better all around, for both HMSO and its competitors, for business to be transferred to the private sector, where it can compete on equal terms and can have freer access to the finance that will enable it to expand.
The only sensible course is clearly privatisation of the bulk of HMSO as it is currently constituted. During such a process, customers will naturally want the maximum assurance that after the sale they will continue to receive the high-quality and cost-effective service to which they have been accustomed. At the same time, potential purchasers will wish to make their own estimate of HMSO's future viability, and to be sure that it will enjoy a reasonably secure level of business after transfer to the private sector. We propose to accommodate both those needs through legally binding contracts between major customers and the privatised business, wherever it is sensible to do so, and for that to come into force at the point of sale.
Parliament is, of course, HMSO's key customer. The contracts will specify all the customer's requirements, standards of service and, if necessary, the means by which the service shall be delivered, as well as price. Customers' requirements will therefore be clearly specified and fully enforceable, ultimately by recourse to law. Agreeing the contracts with HMSO's customers is an onerous task, but I have every confidence that it can be achieved with the co-operation of those customers, whose interests the contracts will protect.

Sir Patrick Cormack: In answer to an earlier intervention, my right hon. Friend gave an assurance that he would reconsider the parliamentary aspect. Will he report to the House on that specific point before pursuing his commercial inquiries?

Mr. Freeman: I have already given an assurance. I must now end my speech, as time is short and others wish to speak, but I shall foreshadow a commitment that I intend to give in a moment. I shall publish the short list of potential buyers; Parliament will have its views on their acceptability.
The needs of Parliament are particularly important, and it is vital for them to be fully protected in the new contracts required by both Houses. I note that new supply and service agreements will shortly come into force between the House of Commons and the other place and HMSO; they will provide a sound basis for the contracts. The right hon. Member for Berwick-upon-Tweed (Mr. Beith) is right: they are wholly independent of and separate from the privatisation proposals, and have an entirely different genesis. I am confident that we can reach a position that fully protects Parliament's needs in the privatisation.

Mr. Mark Robinson: Does that mean that, when the bids come in, they will first be assessed to establish whether they pass certain quality thresholds, rather like television station franchises? Once those that do not pass those thresholds are eliminated, will those that qualify be considered?

Mr. Freeman: Not only would the Government wish to draw up a short list acceptable to Departments; Parliament will insist that, if it is to conclude a contract with the privately owned stationery office, the new owner of the business must be entirely acceptable.

Mr. Dalyell: The Minister has talked of binding legal contracts. Does he realise that the whole set-up in Scotland will have to be rather different? Can he make any statement about the discussions that have been held with the Scottish Office about the future of the 200 people working at South Gyle, 95 per cent. of whom voted against privatisation in a poll? So much for the consultation with the work force of which the Minister speaks.

Mr. Freeman: With respect, perhaps the work force were not entirely aware of the arguments and advantages of what is proposed, not only for the unit in Scotland but for others, in Wales and Northern Ireland. I can give the hon. Gentleman an assurance that the future of those units, and any others, will be made clear before any contract is negotiated and signed. They have been treated as an integral part of the printing and publishing operations of HMSO. I hope that the hon. Gentleman will have noted my earlier assurances about what is to be offered, that is, the whole.
In her letter of 28 November to the Leader of the House, Madam Speaker set out the safeguards that the House of Commons Commission considers necessary to enable the House to continue its agreement with HMSO after privatisation. It was published in the Official Report of 11 December. My reply on behalf of the Government was placed in the Library of the House on 14 December, and explains how those safeguards can be met, primarily through a legally enforceable contract. As well as meeting

Parliament's requirements in that way, potential purchasers will have to honour recently negotiated improvements, such as reductions in the price of publications, and, I hope, negotiate further reductions.
I fully recognise that a change in ownership is a source of concern for staff. However, I am convinced that it is the best means of safeguarding their future by permitting an expansion of the business. I have already given an assurance that I shall consult the trade union representatives of the staff during the sale process. The staff and the trade unions will, of course, be kept as fully informed as possible by the management and privatisation team during the sale process. I can also give the House an assurance that the Transfer of Undertakings (Protection of Employment) Regulations 1981 will apply to the sale of HMSO, and staff will transfer with their existing terms and conditions. That protection is important and applies, of course, in any transaction whether in the public or private sector. I expect the newly privatised business to be able to offer staff a more attractive future as the business prospers and grows.
In selecting a successful bidder from the short list, one of the factors that we will consider is the bidder's plans for the future growth of the business. Pension rights are protected by social security legislation. The new owner will be required to provide broadly comparable pension arrangements. I draw the attention of the House to the fact that the pension scheme is non-contributory. The Government Actuary will be asked to provide an independent analysis of comparability and to approve the new arrangements as offering broadly comparable benefits. In addition, the pension fund will be under the control of the board of trustees, in accordance with trust law.
We will exclude from the sale a small residual body charged with carrying out HMSO's statutory functions. That body will also be responsible for the administration of Crown copyright and could continue to administer parliamentary copyright if Parliament so wished. Retaining responsibility for copyright in the public sector will allow us to sustain and improve the accessible and affordable publication of government information.
I confirm that the Government will seek a buyer who will maintain the integrity of the present HMSO. In no circumstances will we offer the printing and publishing businesses separately. The buyer must, of course, be acceptable to Parliament. To that end, I intend to publish the short list of bidders in due course and to invite Parliament to be involved in the selection of the successful candidate to ensure that a satisfactory outcome is achieved for work for Parliament. I undertake to consult the right hon. Member for Sedgefield (Mr. Blair), the Leader of the Opposition, and business managers on how that should be accomplished. My dealings have so far been with Madam Speaker, acting on behalf of the House of Commons Commission, but further reflection may indicate another approach. That is the arrangement that has existed so far.
In addition to this debate, I have already made a statement to the House and given evidence to the Finance and Services Committee. I remain ready to outline the Government's plans further, in Select Committee or elsewhere.
I commend these plans to the House, in the best interests of HMSO, its customers, its staff, the taxpayer and Parliament.

Mr. Derek Foster: I thank the Chancellor of the Duchy of Lancaster for arranging to have placed in the Library his reply to Madam Speaker's letter to the Leader of the House dated 28 November. I also thank the Chairman of the House of Commons Finance and Services Committee, who, at my request, published the minutes of evidence of his Committee's meeting of 21 November 1995, at which the Chancellor gave evidence about the privatisation of HMSO.
Both documents have only just been made available. I do not blame the Chancellor or the Chairman; they have done their best. The real culprits are the business managers who brought forward the debate from Wednesday to today. They have played into our hands. Because the debate is taking place when the House has not had the opportunity to absorb important new information, that strengthens the argument for another debate in the new year, when even more details will be available. Will the Chancellor and the Chairman of the Finance and Services Committee join me in urging the Leader of the House—I am glad to see him in his place; he has a deep interest in this issue as a member of the Commission—to respond positively to these requests?
The other day, I described the Chancellor of the Duchy as a decent man fallen among thieves. Perhaps I was unkind to thieves. I really do feel sorry for him, as he only just escaped responsibility for carrying through the privatisation of the railways—the poll tax on wheels, in the words of the late Robert Adlee when he was Chairman of the Transport Select Committee. It was out of the frying pan and into the fire. There he is in the Cabinet Office, privatising everything that moves or is stationery. [Interruption.] That was Matthew Parris; we should give credit where it is due. It is a grand clearance sale, or, more to the point, a closing down sale. Everything must go—unbelievable bargains. A thousand little-used Sir Humphreys are going cheap. Those are the actions of a defeated Government. They know that the voters cannot wait to take vengeance. They are scorching the earth in their humiliating defeat.

Sir Patrick Cormack: Did you write that, Derek?

Mr. Foster: Perhaps Matthew Parris wrote that, too.
Why are the Government doing that? Perhaps they need the money to start another party in the wife's name. Looking at today's public sector borrowing requirement figures, has the Chancellor of the Exchequer so screwed up the nation's finances that he has to sell off every candle end before the bailiff arrives?
The Chancellor of the Duchy of Lancaster, in his statement, denies that the money is important. If it is not, perhaps this is an elaborate job creation scheme: not jobs for those who work in the agencies to be sold off, as they are likely to lose theirs, but rather jobs for the boys on the boards of privatised companies, for former Ministers, defeated Members of Parliament and defeated Tory candidates. The Chancellor looks a little hurt, as though Nolan had never been necessary.

Mr. Waterson: The hon. Gentleman drew an analogy with rail privatisation. Is he able to give any commitment to the House that the Labour party, if it were in power, would renationalise HMSO, when unfortunately it is not able to give such a commitment about rail privatisation?

Mr. Foster: The hon. Gentleman is a little premature. The Government have not yet privatised HMSO. They could just be frustrated by an early election. Who can tell?
What other reason can the Government have? Perhaps they have nothing else to do. They have no legislative programme, except a few Bills "to smoke out the Opposition", in the words of the chairman of the Tory party.

Mr. Mark Robinson: Is not the hon. Gentleman playing a rather familiar record, because every time we have debated privatisation we have heard doom and gloom from the Labour party, when the result has been success?

Mr. Foster: If the hon. Gentleman thinks that he has had gloom and doom so far, he should just stick around.
The Government have no Bills to speak of, except to smoke out the Opposition, and Parliament is on a one-day week, so we read. Ministers sit in their offices, dreaming up crackpot schemes to prove that the Government are still fizzing with ideas. The truth is that the Government are drifting aimlessly to the general election, with so little sense of direction that they grasp at anything that will appease their lunatic fringe. Perhaps the lunatics are not yet in charge of the asylum but they have certainly written the business plan. Privatisation is an idea whose time has passed. It has been fatally wounded by the greed of the fat cats.

Mr. Robert G. Hughes: Will the right hon. Gentleman give way?

Mr. Foster: If the hon. Gentleman hangs on, I shall give way to him in a minute.
No doubt, hon. Members will have seen the headline on the front page of yesterday's issue of the Observer. It reads:
Fat cats get £16m boost to pensions".
The whole idea has been blown out of the water in recent months. The fat cats get the cream while the staff get their cards. The Chancellor of the Duchy is fanning the dying embers, and the grand scheme has been reduced to this—selling off HMSO.
My hon. Friend the Member for Bolsover (Mr. Skinner) was right to ask what the Government would sell off next. Will it be the Mace or the Dispatch Box? Such sales are worse than selling off the family silver—now they are selling off the empty boxes in which the silver was kept.

Mr. Hughes: I was happy to wait for the right hon. Gentleman to give way, and I wait in anticipation to find out whether he intends to say anything about HMSO. He said—I am sure I quote him correctly—that privatisation was an idea whose time had gone. At what point did he form that judgment? Presumably he supported privatisations up to a point and now opposes them. Which ones did he support, because from what he has said it is plain that he supported some?

Mr. Foster: That was an entertaining intervention, to which I shall not respond.
This privatisation reminds me of the Deputy Prime Minister's plan to sell off the Post Office.

Mr. Waterson: Hear, hear.

Mr. Foster: Someone still supports that sell-off. The Post Office is profitable, efficient and competitive, but we


were told that the status quo was not an option and that privatisation was necessary to allow the Post Office to compete in wider markets and to borrow for investment in the private sector. The Deputy Prime Minister had to back down because there was not a majority in the House for his scheme. That also applies to HMSO, because there is no majority in either House for privatisation. If the Chancellor of the Duchy gets his way, that may never be tested because primary legislation is not required.
I understand that retaining a residual HMSO to administer Crown copyright and to fulfil the functions of the Queen's printer avoids the need for primary legislation. There is some suggestion of secondary legislation connected with the trading fund, but that might involve only a one-and-a-half-hour debate in Committee. No doubt the Chancellor of the Duchy hopes to sneak this measure through Parliament without a vote, and I can understand why. It was clear from the exchanges on the statement that many Conservative Members are not enthusiastic about his plan. If primary legislation were necessary, I am sure that the Government would not proceed.
As the chairman of the Tory party admitted before the Queen's Speech, most of its measures were designed to smoke out the Opposition. Selling off HMSO fails that test because it smokes out those few Conservative Members of the sensible tendency. For that reason, heaven and hell will be moved to prevent a vote. However, in the November issue of "Public Sector Purchasing" the Chancellor of the Duchy said that the new arrangements for HMSO would not proceed without Parliament's approval. That must mean a vote in both Houses, because I know of no other test for Parliament's approval. Will the Chancellor of the Duchy give both Houses a chance to vote on this measure, which impinges on every hon. Member? Perhaps he would care to respond.

Mr. Freeman: I thought that I had dealt fully and fairly with that issue but perhaps I can confirm that my advice is that no primary or secondary legislation is needed to permit the proposed transaction to come to fruition. I repeat for the sake of clarity the assurance about the retention of HMSO's business of supplying documents to Parliament as an integral part of HMSO. Parliament must be satisfied about the supply contract for that future business. As I have said, that is a prerequisite for completing the transaction.

Mr. Foster: I thank the right hon. Gentleman for that response, but he did not make clear whether there will be a vote in both Houses.

Sir Patrick Cormack: I assure the right hon. Gentleman that it is taken in that spirit and I am sure that there has to be a vote.

Mr. Foster: I am relieved to hear that, but we shall see.

Mr. Mark Robinson: Will the right hon. Gentleman give way?

Mr. Foster: Perhaps I may be allowed to finish this point, and then I shall give way to the hon. Gentleman.
The Chancellor of the Duchy believed that if he could convince the House of Commons Commission or the Select Committee on Finance and Services he would be

home and dry. That is clear from his privatisation time schedule. I am not arguing that hon. Members mistrust the Commission or the domestic Committees to conduct detailed negotiations on our behalf and to safeguard the interests of hon. Members. The guarantees that were sought by Madam Speaker in her letter of 28 November to the Leader of the House are comprehensive, although I am sure that Madam Speaker would consider adding other requirements to satisfy the House.

Mr. Robinson: Is it not open, through the usual channels, to the Opposition to force a vote on any issue on a Supply day?

Mr. Foster: The hon. Gentleman is absolutely right, and that may happen if the Chancellor of the Duchy decides to deny the House a vote. The right hon. Gentleman believed—but I have covered that bit. [Interruption.] That is what comes of spending 10 years in the Whips Office.
I sense from the mood of the House that hon. Members are unwilling to contract out this decision to the Commission or to the domestic Committees. I think that hon. Members will insist on deciding the issue themselves. The Chancellor of the Duchy intends that parliamentary approval should apply only to the terms of a legally binding contract, which will succeed the new supply and service agreement if privatisation goes ahead. That is clear from the right hon. Gentleman's reply to Madam Speaker.
Both Houses will wish to decide on the principle of this privatisation, and I shall explain why. First, HMSO's contract with Parliament is its most prestigious. The Government will not consider privatisation without that contract and, of course, the contract enhances the value of HMSO to a potential purchaser. However, the contract is equally important to HMSO: its services to Parliament are an integral part of the whole operation, which is why management and staff wish HMSO to remain an entity. The Chancellor of the Duchy claims to have been persuaded by that argument, but his wish to keep HMSO as an entity is driven more by the exigencies of his timetable than by any wish to satisfy management and staff. A broken-up HMSO would take longer to privatise, and the right hon. Gentleman's deadline of July 1996 may be unattainable if the House authorities cannot complete the essential preparatory work before that date. Any slippage might send the sell-off into the buffers of a general election.
No doubt, all Conservative Members will have been intrigued by yesterday's front page of The Sunday Times, which says:
Major orders alert for early election
John Major has placed ministers and Conservative Central Office on 'amber alert' for a general election next autumn, six months before his term has to end in May 1997.
They are probably packing their bags now to get back to their constituencies and prepare for Opposition.

Sir Patrick Cormack: For Christmas.

Mr. Foster: Or for Christmas, but if this move were scuppered by an early general election, all the additional work imposed on the House authorities by privatisation would have been for nothing because, without privatisation, a legally binding contract would be unnecessary.


The House authorities have only just concluded a new supply and service agreement. If HMSO. remains in the public sector, that agreement would continue for, say, four years. Concluding that agreement has been most time consuming for the House authorities. Drawing up a legally binding contract will prove even more arduous. Doubts have been expressed as to whether that work can be concluded to meet the requirements of the Chancellor's self-imposed timetable.
Hon. Members are entitled to ask whether any estimate has been made of the additional costs imposed on both Houses by the Government's plan. Will the House require additional members of staff? Has that additional expenditure been budgeted for? If not, can those extra demands be met? If so, what work will have to be deferred to meet those demands? Small wonder that, on 9 December, the front page of the Financial Times revealed a furious row between the House authorities and the Government about this scheme.
Perhaps we should ask an even more fundamental question: what right have the Government to impose extra costs on both Houses without either House being able to decide the issue from which those additional costs arise? Arguably, on that point alone, the Chancellor is under a moral, if not a legal or constitutional, obligation, to let Parliament decide whether it wants those unnecessary costs imposed by an unnecessary privatisation.
The next argument goes to the heart of the unease expressed by Parliament about the dilution of ministerial accountability because of the next steps agency initiative, let alone full-blown privatisation. At present, if hon. Members are dissatisfied with HMSO's standard of service, the Chancellor of the Duchy, as Minister with responsibility for public service, is accountable to the House. He will take some remedial action and report to the House. Here we must ask him how many hon. Members have complained about the service from HMSO. Has any formal complaint been lodged by the House authorities? If none, I suggest that the Chancellor of the Duchy should act on the principle, "If it isn't broken, don't mend it!"
What happens to ministerial accountability upon privatisation? Is the Chancellor still responsible or does that responsibility pass to the people who have signed the legally binding contract? Who will answer to the House? Precisely what sanctions are available, by whom and under what circumstances? In the exchanges on his statement, the Chancellor mentioned suspension of the contract, but surely that is unsatisfactory. The House cannot function without its essential papers. Who will serve the House while the contract is suspended? No other organisation could possibly fulfil the contract's terms on an interim or ad hoc basis.
Those are crucial issues. Can the House tolerate any dilution of ministerial accountability or a suspension of a legally binding contract as a sanction for non-fulfilment? It is clear that those issues arise only because of the privatisation of HMSO. That is why the House must be allowed to vote on the principle of privatisation.
There are other reasons why the House must exercise that right. Two hundred years ago, HMSO was set up to stamp out corruption in public sector purchasing. Because it is a market leader, HMSO is able to use the public sector's purchasing power to hold down prices. Because it acts as an independent broker, HMSO is able to spread

purchasing across a wide range of firms, rather than concentrating work in a few favoured companies. If HMSO is privatised, the public sector will not benefit from those advantages.
During the whole of that 200 years, HMSO has served Government and Parliament, while maintaining the highest standards of confidentiality and meeting the most exacting deadlines required by Parliament. Will the Chancellor tell the House if HMSO has ever been investigated by the National Audit Office or the Public Accounts Committee for maladministration or for falling down on a matter of financial probity?
In January last year, the all-party House of Commons Public Accounts Committee produced one of its most critical reports about the decline in standards of administration and financial probity. The Committee said:
In recent years we have seen and reported on a number of failures in administrative and financial systems and contracts within departments and other public bodies which have led to money being wasted or otherwise improperly spent. These failings represent a departure from the standards of public conduct which have been established during the past 140 years.
Most of those cases arose because business men tried to short circuit administrative and financial procedures. The Government have been so dogged by allegations of sleaze that citizens no longer trust the system and we come to this pretty pass today when the lottery regulator does not even know that his behaviour is improper.
By this reckless plan, the Chancellor of the Duchy runs serious risks with HMSO's impeccable reputation. After privatisation, will HMSO still be subject to examination by the National Audit Office or the Public Accounts Committee? The Government have sullied the name of the public services by intemperate pursuit of private sector values, but they have no right to risk Parliament's name in the same way.
As a security printer, HMSO produces a wide range of security and "in confidence" papers such as the Budget. HMSO has an unprecedented record. No leaks have been attributed to it. Can the private sector guarantee to match that record? From time to time, the nature of such papers can jeopardise national security, so high is the risk. That is important to the House, as you, Mr. Deputy Speaker, will recognise. Of course, Conservative Members will point to all sorts of market-sensitive information printed in the private sector as evidence that security printing can be handled just as well after privatisation. Indeed, in the exchanges following the statement, the Chancellor mentioned that some of the Budget papers are already subcontracted to the private sector. What he failed to mention—this is crucial—was that it was subcontracted only under the strict control of civil servants at HMSO.

Mr. Waterson: I am grateful to the right hon. Gentleman for giving way again. Is he not aware that some highly reputable companies in the private sector, including some in my own constituency, are engaged in security printing day in and day out and conform to high standards of product quality and security? Surely he is not restating the old Labour notion "public sector good, private sector bad"?

Mr. Foster: I was not saying that; I was under the impression that the Conservative party was saying the contrary—"private sector good, public sector bad".


Departments may of course choose not to use the privatised HMSO for their security documents. Perhaps the Chancellor will tell the House whether it is true that the royal military college at Sandhurst has already stopped using HMSO for some of its security documents, because it could not be confident about the security of a privatised HMSO. Perhaps he could also confirm that the Ministry of Defence is already radically reviewing its relationship with a privatised HMSO. [Interruption.] Someone obviously hopes so. When one bears in mind the fact that Ministry of Defence contracts account for nearly 50 per cent. of HMSO's revenues, could not the privatisation be rather dangerous? Could not the privatisation be attacking HMSO's core business, and would not that totally scupper the Chancellor's argument that privatisation is necessary for HMSO to sell in wider markets?
I have dealt with the direct risks to services to Parliament; let us now examine the indirect risks. The first is the sale itself. The Chancellor wishes HMSO to be sold as a whole, apart from the residual HMSO. That might be his intention, but there has been a significant change of emphasis from what he said in evidence to the Finance and Services Select Committee to what he said in his statement. He said the same thing tonight. The worrying phrase is:
in any event we would not separate the publishing and printing businesses".
I am sure that the Chancellor is aware that HMSO is much larger than just the printing and publishing business. Perhaps he is unaware that the statement, which he thinks is reassuring, is actually quite worrying to the staff of HMSO.

Mr. Freeman: The right hon. Gentleman is absolutely right to say that my statement represented a change since giving evidence to the Finance and Services Select Committee. The change was based on the advice of consultants, who recommended not only offering the business as a whole but in any case—whatever the response—not separating the printing and publishing business. Some might say that that represents an advance. I hope that it is a welcome change and that it gives greater assurance not only to the House but to the management and staff of HMSO.

Mr. Foster: I do not think that the staff will find that reassuring. They are completely committed to HMSO surviving as an entity. The Minister re-emphasising that he would not in any event separate the publishing and printing business will certainly not be the kind of reassurance that he imagines that it will be. Under the exigencies of having to push through a sale before the general election, surely it is possible that the Chancellor will change his mind even more—perhaps his consultants will advise him again.
Even if the Chancellor succeeds in selling HMSO as an entity, what guarantee is there that it will remain an entity for long? Rumour has it that a finance house will be the most likely purchaser. The purchase would be made with a view to flotation in two or three years' time. What guarantee is there that the new owner would not hive off bits of the business? Indeed, wringing out of HMSO's £340 million turnover the kind of profit that I have heard mentioned could be achieved only by hiving off the least

profitable and concentrating on the most profitable bits of the business. Redundancies would inevitably follow. On that very subject, the Chancellor said that there would be no automatic redundancies. What does that mean?
What guarantee can the Chancellor of the Duchy give that the company would not fall into foreign ownership, which would be unacceptable to Parliament? He will recall that Madam Speaker's letter made special mention of that. What guarantee can he give that the new owner would not be driven by the market to look for cheaper and poorer quality services to Parliament? The interests of the City coincide only rarely with the public interest. Despite his good intentions, the market might exert pressures opposing Parliament's wish to make its papers more widely and cheaply available.
For all those reasons, both Houses should have the opportunity to vote on the issue, not only on the narrow terms of the legally binding contract. Those reasons are sufficient for the new Public Service Select Committee to investigate thoroughly the risks to parliamentary services, but the Committee will be able to range more widely.
For example, the thrust of the Chancellor of the Duchy's argument is that HMSO's public sector market is declining and that privatisation will enable HMSO to sell in wider markets and borrow for investment in the private sector. When challenged as to why the Government will not arrange for HMSO to operate with full commercial freedom in the public sector, he responds that that is not Government policy. [Interruption.] Does the hon. Member for Harrow, West (Mr. Hughes) want to intervene?

Mr. Robert G. Hughes: I have made my point.

Mr. Foster: I think that the hon. Gentleman said that it was daft.
Frankly, that is not good enough. The Chancellor of the Duchy is forcing through an unnecessary and unwanted privatisation—it is certainly unwanted by the staff, 95 per cent. of whom voted against it, as my hon. Friend the Member for Linlithgow (Mr. Dalyell) said, and we would probably find that it was unwanted by both Houses of Parliament, if they were allowed to vote. He is forcing it through on the pretext that there is no alternative, but he has not even examined the options. Will he confirm that this option was not one of those in the terms of reference given to the consultants who advised him?
HMSO staff are proud of their record in the public sector. It has met all the targets set by central Government and undergone fundamental change in the past 15 years, becoming a trading fund in 1980 and a next steps agency in 1988. It has been trading commercially since 1980 and with increasing commercial freedom as it has responded to competition from the private sector. All the changes have been negotiated with the co-operation of the staff. They are proud of their record and take pride in the high-quality service that they provide to Government and Parliament. They want HMSO to remain in the public sector.

Mrs. Gwyneth Dunwoody: Is my hon. Friend not filled with despair by the fact that we have a Government who are so little conscious of the importance of our sovereign Parliament that they are prepared to hand the printing of something as vital as the


papers that flow from Parliament to a private firm, not because that is necessary but for the sake of a spurious argument about profit?

Mr. Foster: I thank my hon. Friend for her intervention. Of course we understand—

Mr. Bernard Jenkin: It was not very helpful.

Mr. Foster: We are one party, unlike the Conservative party. My hon. Friend is absolutely right. The whole scheme is being driven by the dogma that HMSO must be put into the private sector if it is to succeed in future. [Interruption.] I am addressing the whole argument. The Chancellor of the Duchy fails to address that argument, which is why I want him to refer the matter to the new Public Service Select Committee.
The Select Committee should also examine the costs of privatisation. For example, what has been paid to consultants and advisers so far? What is the Government's estimate of additional fees before the sale is complete? How much will privatisation cost HMSO in staff time? How much investment has been carried out already in preparation for privatisation? How far is the low profit in last year's accounts due to exceptional redundancy payments in preparation for privatisation? How much is the preparation for privatisation costing both Houses and will that be taken into account in the contract? How much will be lost to the taxpayer by sacrificing a stream of profits year on year for a one-off contribution from the sale? How far has HMSO's performance been affected by two or three years of uncertainty and the resulting staff demoralisation? How much will be lost to the taxpayer by selling off valuable assets at knock-down prices to secure a quick sale? Is this a good time to sell in view of last year's poor results?
I shall deal now with the issue of European law, and shall touch on a couple of matters related to the Transfer of Undertakings (Protection of Employment) Regulations 1981. I understand that the House of Commons operates under the provisions of the public service contracts regulations of 1993, which require tender procedures for contracts of service. That may mean that the House could not commit itself in advance to a contract with a privatised HMSO.
I understand, however, that if a contract were entered into before privatisation and transferred as part of the sale, the regulations would not apply. If so, that might contravene European law. In answer to my question during his statement, the Chancellor of the Duchy responded that he was advised that that was not a problem. Will he publish the points on which he sought advice and the advice that he has been given? I shall certainly publish advice that I have received from lawyers advising the trade unions, which suggests that there may be some conflict with European law.
For the Chancellor of the Duchy knowingly to flout European law might make him some kind of a hero with his Euro-sceptics, but it would be quite wrong for him to involve the House authorities in a breach of European law, and wrong for him to involve the legislature in such a breach without a vote in both Houses.
The Chancellor of the Duchy has confirmed that TUPE will apply and we welcome that—although, understandably, staff are suspicious of how long the terms

and conditions of employment will be maintained under the new owner. Pensions, of course, are not covered by TUPE. Although the requirement is said to be "broadly comparable" to the civil service scheme, there are great concerns about what that will mean in practice.
The scheme should not go ahead without a vote in both Houses of Parliament. It should be referred to the new Public Service Select Committee for a thorough examination of the risks to services to Parliament, of the costs of privatisation and of the feasibility of giving HMSO full commercial freedom in the public sector.
The Chancellor must be aware that his scheme is deeply unpopular with HMSO staff. He is also clearly not the blue-eyed boy with the House authorities. His scheme is unpopular with all Opposition parties, and many of his Back Benchers are reluctant supporters. Perhaps he should observe Lord Healey's first law of holes—when one is in a hole, stop digging. That at least would bring relief to the hon. Member for Norwich, North (Mr. Thompson), who would not have to be a Norfolk turkey voting for an early Christmas. Indeed, the hon. Gentleman's Government want to present him oven-ready to the voters and he has been stuffed by the Chancellor of the Duchy. No wonder he is doing the turkey trot. Who would be a Tory candidate in Norwich if this madcap scheme went through?

Mr. Paul Channon: The House has had a treat that it has not had nearly frequently enough in recent years: a speech by the right hon. Member for Bishop Auckland (Mr. Foster). I cannot say that I agree with everything that he said. Indeed, it could be argued that a speech of 37 minutes was a trifle long for a debate of this length. Chief Whips have said that to me on other occasions, but perhaps different standards apply to those who no longer have that great responsibility.
I shall be extremely brief, unlike some, since my job is to report on the Minister's appearance in front of the Select Committee on Finance and Services, to which the right hon. Member for Bishop Auckland was good enough to make reference. I note that the right hon. Gentleman now wants to send the report to be examined in great detail by the Public Service Select Committee. The more the merrier I suppose. If my Committee were thereby relieved of another duty, I do not suppose that the Committee's members would mind too much.
But, in fairness to the House, I should say that the appearance of my right hon. Friend the Chancellor of the Duchy of Lancaster gave us quite a bit of comfort because he answered all the questions that we put to him and showed no reluctance whatever to appear. Indeed, he has not shown any reluctance to appear in the House, either for the recent statement or this week's debate.
If I understand the remarks of the right hon. Member for Bishop Auckland, he says that we must have a vote on the issue. I would not necessarily mind that. I do not see how a vote could be stopped if hon. Members wanted it. As the right hon. Gentleman said, if necessary, the Opposition can use a Supply day. If those in the House want to vote they will vote. If they do not want to vote, they will not vote. It does not seem to be a particularly difficult thing for which to campaign.
There are differing views across the Floor of the House about the merits of privatisation and how it has worked on various occasions in various industries in the past, but


that is not of great importance to me or, indeed, to the members of my Committee. Whatever our individual views on privatisation, what matters is what effect this particular privatisation would have on the House of Commons.
If we were satisfied that the House of Commons' reputation would be damaged, that the service to the House of Commons would be severely damaged or on other such grave matters, regardless of party affiliation, we would be right to be against the proposal. My Committee therefore examined the proposal and took evidence from the Chancellor in order to try to address the very natural doubts and worries felt by hon. Members on both sides of the House about the privatisation of the stationery office.
I accept what the right hon. Member for Bishop Auckland says about the excellent service that the stationery office gives and has given for many years. I pay my tribute to it. But I do not want hon. Members to go away imagining that it has always been roses dealing with the stationery office in this House. When I was a Minister responsible for the stationery office, again and again statements were made and questions were asked because papers did not appear on time. Indeed, the same thing happened to my immediate predecessors in the Labour Government. So being in the public sector was not always a safeguard that things would be all right with the stationery office.

Mr. Michael J. Martin: Does the right hon. Gentleman agree that the absence of documents is a common complaint in Standing Committees? It is important to ensure that the record of the previous sittings is available to hon. Members serving on those Committees. Does the right hon. Gentleman agree that hon. Members often raise points of order because the Hansard for the previous Tuesday or Thursday is not available?

Mr. Channon: I am sure that the hon. Gentleman is right. It is some years since I raised a point of order in a Standing Committee, and I hope that opportunity will not arise again for quite a while.
I was the Minister under whose regime and benevolent rule the stationery office became a trading agency, to which the right hon. Member for Bishop Auckland referred with pleasure.
We have seen in Hansard the letter from Madam Speaker containing 12 paragraphs of conditions that she thinks are necessary before the House could agree to a privatisation scheme. It is no secret that the matter was debated in the Commission, nor is it any secret that the matter was debated in the Finance and Services Select Committee—the relevant papers are published. I recall no resistance to the suggestion that the Minister should make a statement. I recall no resistance to the suggestion that there should be a debate. The very fact of a debate implies that, as a possible result of it, there might be a vote. Such a vote could easily be arranged in the future.
All I want to ask is whether my right hon. Friend can repeat the assurance he gave to the House on a previous occasion. Can he repeat that he will not proceed with the privatisation of the stationery office unless he can conscientiously convince the House that the 12 points of

reservation that the Speaker made in her letter will be met in full? My right hon. Friend has already given us that undertaking, but I think that he must give it again to the House tonight. The House can then come to a fair judgment about the future. If those assurances cannot be given, I am sure that the House will not wish to proceed with the privatisation. If my right hon. Friend gives that assurance, I for one will be happy, at least at this stage, to look at the proposal with an open mind and to consider the evidence. I would be happy to give way to my right hon. Friend.

Mr. Freeman: I am grateful to my right hon. Friend. I repeat the assurance that I have already given on that point. Because of the importance of HMSO to parliamentary business, it is obvious and self-evident that Parliament must be satisfied. I cannot dictate Parliament's wish or conclusions on the matter, and therefore it cannot proceed unless Parliament is satisfied.

Mr. Channon: For me, at least, that goes far enough for me to say that, at this stage, I am content to proceed further and see how the negotiations go. The Minister said that Parliament's wishes must be paramount, and that must be the aim of all of us, whether we are in favour or against privatisation in principle.

Mr. John Garrett: Her Majesty's Stationery Office employs 2,800 workers, of whom 900 are in my constituency at the Norwich headquarters of HMSO. Therefore mine is a primarily constituency interest, although I also have a public service interest, as we all do.
As my right hon. Friend the Member for Bishop Auckland (Mr. Foster) said, HMSO was set up in 1786 to stamp out corruption in public service purchasing. It is profitable, highly successful and has declared a surplus since 1980. It is in the middle of a three-year plan. As a result of being in the public sector it has the advantage of being able to use the purchasing power of the public sector to hold down prices. It also enjoys large economies of scale, and can spread its purchasing across a range of suppliers. Those advantages have served the Government well.
One essential is that HMSO is not broken up, on or after privatisation. The Minister frequently says that he will not split its printing from its publishing activities. The right hon. Gentleman has not hitherto realised that one third of HMSO's business is in office equipment and office supplies. If those businesses were sold off—that would be a strong temptation to a private contractor—much of the overhead of the total organisation would have to be spread over printing, print buying and publishing. The loss of one third of the business would make HMSO non-viable. We fear that a major institution would buy HMSO as a whole and then, relatively quickly, resell the profitable parts and collapse the rest of it.
What guarantees of employment will be extracted from a purchaser? Every other privatisation has been accompanied by massive job losses. That is the burning question in Norwich, which has lost 2,500 jobs directly, and probably as many again indirectly in the past few years. It cannot withstand massive new redundancies. I believe that guarantees of employment in the tender from potential private purchasers are essential.


The Government tell us that the TUPE regulations will apply to the workers at HMSO, but those regulations specifically state that workers' terms and conditions may be changed for technological, organisational or economic reasons. HMSO operates on the leading edge of a number of technologies, and is therefore regularly reorganised. The protection afforded by the TUPE regulations may therefore be minimal. Equally, those regulations do not apply to transfers via change of share ownership. We understand that the current preferred route for a sale is to a financial institution, which may therefore not comply with current terms and conditions. Even the Government acknowledge that TUPE regulations provide protection only at the point of sale. If HMSO were to be broken up later, the businesses which were sold on would also not benefit from TUPE. I am strongly under the impression that the TUPE conditions last for three months and would not apply any longer to HMSO.
When I asked the Minister at the time of his statement what steps he would take .to guarantee security on privatisation, he was unable to answer. HMSO is a security printer—I am well aware that there are other such printers—which produces in-confidence Government and parliamentary papers, passports, benefit books and other products where security matters, and which are subject to potential fraud. There has never been a leak from HMSO. What private sector company would offer such a guarantee when making a tender to take over HMSO?
HMSO already carries out work for the French Department of Employment and the German Post Office. Why could it not spread into the European public sector markets and British non-Government markets while being retained as a public sector body? HMSO already operates in private markets, and most of its work has already been exposed to market testing. Virtually every test has been won in-house because of the efficiency of HMSO. In fact, 75 per cent. of its goods and services are already purchased from the private sector.
HMSO has made the profit required of it while publishing important but limited-interest publications, which the private sector would be unlikely to publish because of the lack of profit in particular publications. Open government requires a state publisher prepared to publish limited-interest publications without the constraint of profit.
The Minister referred to the constraint on the HMSO of the public sector borrowing requirement, but HMSO has made no call on borrowing in the past 15 years.
In addition to employment and commercial considerations, there are, of course, important parliamentary considerations, which have been the subject of most of the speeches so far. How can a private contractor have the parliamentary experience of HMSO? What will happen if a private contractor fails to provide Parliament with the publications that it needs to do its work? If a contract replaces the present arrangements, all that Parliament can do is invoke a penalty clause. What good is that? Parliament would meanwhile grind to a halt. When will a detailed statement be made on safeguarding Parliament's interests in the cause of privatisation? Will they be made clear in the tender document? Who will be responsible if a private stationery office fails to provide the service that we need? Do the Government propose to hold a golden share in the privatised HMSO, so that at least they have some arm on it?
I have some other questions on parliamentary matters. Will the privatised stationery office be the ultimate owner of current and future stocks of Government and parliamentary publications, and of the associated electronic archive? If so, what would the situation be if the company went bankrupt or were taken into foreign ownership?
A privatised stationery office will naturally wish, in the interests of its shareholders, to extract maximum commercial value from official documents and data. How does that fit in with Government policies on public access to official information, for example, the trend to put more and more Government documents on the Internet?
The House is making an effort to bring down the sale price of Hansard and other parliamentary documents—a policy which will benefit Government Departments as purchasers of those documents. Do the Government support that policy? Are they making a similar effort to hold down the sale price of their documents? A Government-funded subsidy is currently paid to enable public libraries to purchase all official publications at a substantial discount. Can we take it that subsidy is not affected by the proposed privatisation of HMSO?
The Minister made a great deal of the fact that House officials recently completed negotiations of a new supply and service agreement, or SSA, with HMSO which is intended to come into effect on 1 January 1996. Are Ministers using that SSA, or related information on the House's financial arrangements with HMSO, for the purpose of discussions with potential purchasers? In other words, will the SSA be built into discussions with potential purchasers? Will the south London press—with its access to Parliament and its unique experience—continue to operate under guarantee? Because of parliamentary business, HMSO's costs are relatively high and its return from sales relatively low. This bodes ill for its survival.
I do not find the Chancellor of the Duchy's answers to the Speaker's letter sufficiently satisfying on the main points. The Speaker raised the matter of the parliamentary press in south London, and stated that there was concern that somebody who took it over
would be tempted to experiment with cheaper methods for providing the service
at a risk to the service to Parliament.
The Speaker referred to the complexity of the House's documents and the procedural rules which underpin them. She said:
HMSO staff and management acquire experience and knowledge of those complexities as they progress from job to job in the organisation; and they are brought up in the tradition that in all circumstances the requirements of Parliament are paramount.
It is unlikely that a private contractor would see the interests of Parliament as paramount, because it is an intangible requirement and is very difficult to put into a contractual document.
There is also the question of ministerial oversight. Who will be identified within the privatised stationery office to be responsible for contact with the House? Will there be any attempt to water down the SSA with HMSO without agreement by the House authorities? I assume that there could be a period in which the SSA would lapse. The Speaker's letter continued by saying that
we consider that any prospective purchaser of the Stationery Office should be required to accept the agreed principles which are set out in the SSA, particularly so far as they concern the rights of the House to regulate the production and reproduction of its documents, in both paper and electronic form.


That applies also to location, and particularly to the location of the south London press that produces Hansard.
The fact is that this is a mere matter of dogma and ideology. The Minister speaks of new opportunities, but new opportunities could been found for HMSO without a requirement to privatise. The staff at HMSO certainly do not think that privatisation will bring new opportunities, because 95 per cent. of them rejected privatisation. The proposal is simply a product of ideology, and the least the House deserves is an opportunity to vote it down.

Mr. Patrick Thompson: I am grateful for the opportunity to speak in this debate because, like the hon. Member for Norwich, South (Mr. Garrett), I have some constituency interest in the matter. HMSO is based in the hon. Gentleman's constituency, but many of my constituents—I do not know exactly how many—work at HMSO.
I share one thing with the hon. Gentleman, and possibly more. My constituents' worries are no doubt the same as those of his. After all, I am sure that one could not distinguish between the letters which he has been receiving from his constituents who work at HMSO and the letters that I have been receiving. It would be silly of me to suggest that there is some kind of difference in concern across the constituency boundary.
I want to be frank with my right hon. Friend the Chancellor of the Duchy—there is, if not universal concern among the employees of HMSO, certainly considerable concern. That is why it is important for the matter to be debated and, to that extent, I must support some of the hon. Gentleman's remarks.
The Government should think long and hard about the way in which they go about this change. It is my first duty to get across to the Government that any change must be in the interests of my constituents. Any other constituency Member of Parliament would say the same. However, I differ from the Opposition Members who spoke in that I would say that there is a hard commercial case to be looked at. If there is time, I shall refer to this matter again. The market has been declining, and HMSO has had to take a long look at the question of possible staff reductions. Therefore, it is wrong of the Opposition to suggest that everything can be left exactly as it is, and that everything will proceed if that is the case.
The right hon. Member for Bishop Auckland (Mr. Foster) complimented me by comparing me to a turkey. I may have got his comparison wrong, but it had something to do with Christmas. The hon. Gentleman would have disappointed my constituents. This is not a party political point. He spoke for some 37 minutes, but he did not say a great deal about what the Opposition would actually do to address the commercial difficulties and problems which HMSO is facing. After all, my constituents are concerned with the distinction between public and private service, but they are also concerned about jobs and prospects. My right hon. Friend the Chancellor of the Duchy is right to say that something needs to be done to improve the opportunities within HMSO, or any succeeding organisation, and those arguments must be taken seriously.
It is appropriate that we talk about constituency issues—or Norwich issues—in this debate, even though it is a wider-ranging debate about Parliament and Hansard. Luke Hansard lived in Norwich and served his apprenticeship there before moving to London in 1774. All of us who have read up on the matter know the history. It is important that, in debating HMSO and Parliament, we bring Norwich into it, and I make no apology for doing so. There are other issues which I would like to address briefly in a moment.
The issues are being considered by the House of Commons Commission and by the Finance and Services Committee. The hon. Member for Norwich, South also referred to parliamentary issues in his speech. I referred to some of the issues in an Adjournment debate in April of this year, when I talked about the cost and distribution of Hansard, the reporting of parliamentary debates and other important matters. I shall not go into great detail, but I hope to refer to those matters as well as talking about Norwich.
I would be very unhappy if I felt that there was any chance at all of the main headquarters of HMSO moving out of Norwich. That may sound unreasonable, but—as a constituency Member of Parliament—I would have to be unreasonable if I thought that there was any chance of that happening at all. How could I or the hon. Member for Norwich, South say anything else? The Norwich tradition is tremendous, and the strong connection with Norwich must continue. I make no apology for pressing my right hon. Friend on that particular point, as it is important. It is important that the people of Norwich retain their jobs, and also the strong, traditional and historic links which HMSO has with Norwich. I make no apology for pressing that point over and over again. It is important to me, and it will remain important to me if we debate the matter further at a later stage.
As I said earlier, many of my constituents have written to me to express their concerns about what they see as the Government's plans. I would like to pay tribute to my right hon. Friend the Chancellor of the Duchy for the way in which he has kept me—and, I have no doubt, my colleagues in the House—fully informed about how the Government are going about this. My right hon. Friend has so far kept in touch with the management, staff and trade union side at HMSO, and has done so superbly. I think that he has visited Norwich twice—I know that he has done so at least once—and that he intends to do so again. One cannot fault him on this, and I hope that he will continue to keep fully in touch with everyone involved at HMSO.
When my right hon. Friend visits Norwich, I hope that he will find time also to visit CCTA which, curiously, stands for the Government Centre for Information Systems. I defy any hon. Member to work out that one. CCTA is situated in my constituency, and of course it is also facing changes. I hope that my right hon. Friend will approach the changes at CCTA in the same courteous way in which he has approached the changes at HMSO.
Many fears have been expressed in the correspondence that I have received from my constituents. Some of those fears are not well founded, but some need serious answers.
My constituents are rightly concerned about the effect on the Norwich economy. It is no secret that we have had serious job losses in Norwich in recent years. I hope,


therefore, that my Government colleagues will take seriously the fact that the Norwich economy is an issue at the moment. Communications to Norwich are an issue and jobs in Norwich are an issue. Those points are relevant and my constituents are right to address me on them.
My constituents have referred to other issues about which other hon. Members have already spoken so I do not need to say too much about them. They refer to the possibility of asset stripping and to the possibility of splitting HMSO into units. They also talk about security, to which other hon. Members have referred. I am not saying that those concerns are necessarily well founded, but I know that people are worried about them and Ministers must answer those points.

Mr. Grrett: If there were a vote, would the hon. Gentleman vote for or against the privatisation of HMSO?

Mr. Thompson: I would want to find out first whether my right hon. Friend the Chancellor of the Duchy of Lancaster had answered my concerns. As I said a moment ago, he has gone about things sensibly. We shall have to wait and see whether he continues in a sensible way. In spite of the remarks by the right hon. Member for Bishop Auckland, we do not know whether we shall have an opportunity to vote. My right hon. Friend has suggested that the proposal could go through in a Standing Committee. I feel—here I agree with the hon. Member for Norwich, South—that the proposal needs thorough debate and airing in Norwich as well as in the House. It is important, therefore, that I and colleagues here express all our concerns as well as—here I disagree with the hon. Gentleman—the advantages that may accrue from privatisation or from some similar change.
Several hon. Members have referred to security. I have some sympathy with the idea that there is a risk, if the civil service is left out of it all, that there will be extra leaks. The only trouble is that we seem to have an awful lot of leaks even with our present governmental system.

Mr. Beith: It is the politicians.

Mr. Thompson: I shall not respond to that.
In June 1994, I received from HMSO its newsletter, which comes out at regular intervals. Its controller and chief executive at that time was Paul Freeman; I am not sure whether that name has any significance for my right hon. Friend the Chancellor of the Duchy of Lancaster. Mr. Freeman headlined his article with the words "Streamlining to survive" and then made the following key points:
Up to 30 per cent. of current jobs may have to go for HMSO to remain competitive. Corporate services to be reduced to around 150 staff. Voluntary Early Retirement to continue.
I could reel off his key points. Anyone who suggests that HMSO's problems start as of this debate is misleading my constituents and the House. There are continuing problems which the management of HMSO have to address and which my right hon. Friend is trying to address. We must try to push some of the more obvious party political controversy to one side and to look at the serious issues.
My right hon. Friend is probably right, therefore, to suggest that the freedom to trade within the private sector will lead to opportunities for business growth and could well lead to better employment prospects in Norwich. That possibility is, of course, subject to my earlier point

about the headquarters remaining in Norwich. New technology means that the staffing requirement may reduce and the volume of production by the printing presses and so on may need to increase. That is why I support the hon. Member for Norwich, South when he talks about expanding HMSO's activities to printing for the European Parliament and for organisations overseas. That must be good news whatever we do politically and it is an important point.
My hon. Friend the Member for South Staffordshire (Sir P. Cormack), who is not now in his place, referred to public service. I too have some difficulty here because I am a traditionalist at heart and a conservative, as many of my constituents are. Although I fully see the commercial arguments in favour of privatisation—perhaps jobs are the issue that will really count in the end—I have some sympathy with those such as my hon. Friend who say that public service is important in itself. That does not mean that I go along with the old Labour view that everything in sight should be nationalised, but I believe that there is a concept of public service. Those of us who have served in the professions, as I have, will not allow our party colleagues to sweep aside the concept of public service. I will certainly not have that. Those in HMSO who are genuinely arguing, not in political terms, for the concept of public service should not be dismissed out of hand. To be fair, I do not think that my right hon. Friend the Chancellor of the Duchy of Lancaster dreams of doing that. I must, however, put on record that the concept of public service is an issue that we have to address.
I have made most of the points that I wanted to make on behalf of my constituents. To sum up, I believe that my right hon. Friend is handling the matter well. He is keeping people in Norwich fully informed and, as I know, he has a lot of support from those who are responsible for HMSO and for taking it forward into the future. However, my right hon. Friend has a lot of work to do to convince the employees as a whole of the rightness of this move.
The point of my speech is to persuade my right hon. Friend to do all that he can to ensure that there is, if not here in Parliament certainly within HMSO, a thorough debate about the future. Subject to all that—here I respond to the hon. Member for Norwich, South—I would have no difficulty, if the matter came to a vote, in voting for the proposals as long as I was convinced that they were in the interests of my constituents. If I were convinced of that, I could override any other reservations that I might have or any old-fashioned ideas that I might have—which unfortunately I have not got rid of altogether.
There is a parliamentary issue as well. Hansard, which is printed and published by HMSO is important. It should be distributed more widely and that is why I initiated an Adjournment debate on that subject some months ago. I was keen that the price of Hansard should be reduced. On 6 December, the right hon. Member for Berwick-upon-Tweed (Mr. Beith) confirmed in a parliamentary answer that there would be reductions. There had been an earlier reduction in the price of the weekly Hansard from £22 to £12 as long ago as May. Within the past week, there has been an announcement of a reduction in the prices of the daily Hansard, Bills and Select Committee reports. That is a move in the right direction.
If we move to privatisation, about which I am happy subject to the conditions I outlined, we must ensure that Parliament is protected in a number of ways. One way is


to ensure that Hansard becomes more available—whether through electronic communications and the Internet, through cheaper printed Hansard or through free or cheap issues to public libraries, I do not mind, but I believe that it is important to Parliament to ensure wider distribution. I have no idea whether that has anything to do with privatisation, but I believe that whatever change comes, it is important.
I know that many hon. Members on both sides agree that the reporting of Parliament is going by default. The press reporting of Parliament is a disaster; it has now been reduced to sketch writing and the trivial. There were references earlier to Matthew Parris who, dare I say it, is probably the best sketch writer.

Mr. Waterson: Where is he?

Mr. Thompson: I have no idea where Matthew Parris is. The sketch writers are here only for the first hour or so of the day and they then go off to dinner or to do whatever else they do. They certainly lead a comfortable life. Matthew Pan-is is probably the best sketch, writer, yet even he often bases his sketches these days on matters that have nothing to do with what has take place in the Chamber. I could expand on that but I shall not do so, you will be relieved to hear, Mr. Deputy Speaker. There is an important issue and I shall return to the subject of Hansard and its circulation at a later date.
I will not submit to the temptation of saying anything more on a subject about which I feel extremely strongly. I say merely that I hope that my right hon. Friend understands my remarks on behalf of my constituents. I hope, once again, that he will accept my appreciation for the way in which he is going about the debate on this important issue.

Mr. Martin O'Neill: I am sponsored by the printers union, the Graphical, Paper and Media Union, and it is perhaps appropriate that I should deal almost exclusively with that aspect of the matter.
One problem with the reporting of Parliament concerns the technical difficulties that now weigh heavily on newspapers, because of the deadlines that they have to meet, so that the presses can start rolling at a particular time. That sort of problem does not arise with HMSO. The arrangements that have been arrived at between the work force, Hansard and those in this House who pay the bills, as it were, mean that the service is carried out in a unique way.
My hon. Friend the Member for Glasgow, Springburn (Mr. Martin) mentioned a problem that those of us who sit on Standing Committees encounter from time to time: the non-availability of papers. I am assured by my friends who work on the printing presses that they would be more than happy to be able to provide that service earlier for the convenience of the House. It is the constraints that have been imposed on them over a period of time that prevent them from doing so.
It is unfortunate that the Chancellor of the Duchy of Lancaster has left, because I was going to pay him something of a compliment. He is well known on both sides of the House as a courteous and solicitous man. In the past,

I have had to cross swords with him on many occasions when he represented other Departments and I have always found him to be genuinely concerned. As a consequence, he is sometimes a wee bit thin-skinned and takes it all out when the barbarian hordes in the Opposition try to rough him up a bit. Although his answers this evening have been polite and courteous, they have not been satisfactory. He has almost been honest enough to admit that, in so far as he has said that he cannot give guarantees on the number of jobs after the sale of the business or what the working conditions will be.
We have given the Chancellor of the Duchy of Lancaster four or five days' notice, but he seems to misunderstand the nature of the Transfer of Undertakings (Protection of Employment) Regulations 1981. My hon. Friend the Member for Norwich, South (Mr. Garrett) referred to the criteria by which a change in circumstances may take place. When ownership changes, some three months' notice has to be given before the TUPE regulations can be altered. I think that the figure is 90 days, so it is nearly 14 weeks. That is the point at which negotiations start.
We know that such negotiations would not necessarily involve the preservation of the status quo. Indeed, there would be no point in having negotiations or giving notice if there was not going to be a change. We also know that when ownership changes, new owners are often ambitious enough to notice areas of profitability or loss that they would like to promote or cut out. As a consequence, jobs may go and factories may be moved about the country.
As a Scotsman, I remember that it was only 10 years ago that Mr. Ernest Saunders came to Edinburgh and told everyone that the Distillers company headquarters, which was then located in the city, would remain there and that Guinness, having taken over Distillers, would locate its business in Edinburgh. That may have been an early sign of the Alzheimer's disease that apparently afflicted Mr. Saunders later and from which he miraculously recovered.
I do not suggest that the people who take over HMSO if the privatisation goes through will behave as Mr. Saunders did, but unless something that will last for a long time is written into the terms of the sale, the chances of the headquarters remaining in Norwich are, to say the least, difficult. I do not say that because I wish anything to happen to the headquarters in Norwich. As one who represents a Scottish constituency, I know the importance of breaking the stranglehold of London on all business and commercial life. One does not have to be in favour of devolution as much as the Government are opposed to it—or dubious about it, like my hon. Friend the Member for Linlithgow (Mr. Dalyell)—to recognise that we need a diversity of not only ownership but location of ownership across the country. I am dubious about any assurances that the Chancellor of the Duchy of Lancaster might try to give us on the matter.
Hon. Members have continually returned to the point that it is somehow necessary to change ownership because the business is contracting, so there has to be some sort of commercial freedom that has hitherto been unavailable. Such a lack of commercial freedom did not restrict British Rail, prior to the threats of privatisation, from being in competition with companies to deliver parcels or, indeed, bodies. No competition was allowed in respect of the railway lines, but there was competition in respect of parcels. There is also the Post Office, which offers a range


of services in the public sector, enters into competition with private sector companies and goes after commercial contracts with private businesses.
I do not understand why HMSO, in its myriad activities, cannot, for example, bid to provide local authorities with papers and services or offer to print examination papers for examination boards. If it can produce cheques for giros, why not for banks? Why could it not be allowed to print bank notes? Some of those activities might well require investment, but nobody suggests that the sizeable investment that HMSO has had to undergo over the past 15 years came from the City or broke the Treasury rules. It was generated from within the business. I cannot see why the rules that apply to some bodies that operate in the public sector should be denied to HMSO. I find the Government's blinkered attitude strange.
It is equally strange that when, at this late stage of a Parliament, the Government are trying to keep the privatisation fires burning, this is the best that they can get away with. The criteria for privatisation now are not how much money they can get or the scale of the operation; they are whether it can be achieved without legislation. That is the case with the privatisation of the nuclear industry and with that of HMSO. Both are businesses which have operated extremely efficiently and which, of their sort, could be classed as world leaders, but both are to be sold off.
We do not know what the sum involved will be yet. We shall find out, doubtless, in due course. We shall want to know whether the quality of service that the House and the country receive will be sustained. It is a service that enables people to go to HMSO retail outlets and purchase papers at the same time across the country. It publishes papers of a sensitivity that can sometimes be of tremendous commercial advantage to individuals. That service is carried out by people who are not especially well paid and who will not themselves gain from the privatisation. Those people have committed themselves to the service of the community. I emphasise the point that the hon. Member for Norwich, North (Mr. Thompson) made—an ethic of public service still prevails and has its adherents.
Some of the people of whom we have been speaking, such as those who are recipients of non-contributory pension schemes, may begin to look at the matter differently if they are required to pay 6 per cent. or 9 per cent. of their salaries towards the pension fund, which will by and large, but not necessarily, just about meet present pension requirements. That is where the Minister's lack of clarity throws into doubt the sincerity of the whole operation. Between Thursday and today, the Government's position has shifted. On Thursday, HMSO was to be sold off in its entirety; tonight, the Minister said that he is willing to look at the printing and publishing business being dealt with separately. If the printing and publishing business is separate, I am not sure whether the headquarters at Norwich could survive.

Mr. Patrick Thompson: I am grateful to the hon. Gentleman for giving way because I wanted to speak on that point, but time did not permit me to do so. It was also raised by my hon. Friend the Member for South Staffordshire (Sir P. Cormack). I, too, have my doubts about the separation of the two sides of the business, although I realise that this is a parliamentary rather than

a constituency matter. However, jobs could be at risk and I am grateful to the hon. Gentleman for raising that concern, which I share.

Mr. O'Neill: Other hon. Members have raised the issue and will continue to do so.
We are not happy with this proposal. My colleagues in the printing unions are dreadfully worried about it because they have seen too many takeovers in the recent past, in which working conditions have worsened, factories and printing shops have closed down and pension funds have been messed about. We welcome the Minister's assurances, but I hope to God that his ambitions and ours will be realised. As we say in Scotland, "I hae ma doots aboot that," because we do not believe that those who want to take over HMSO will have anything like the ethics of public service behind them and will take the company's long-term interests to heart. Ultimately, they will run the company for three or four years, strip it down, separate off parts of the business that are not commercially attractive, perhaps give them away at knock-down prices, and then try to realise from the profitable core the best price that they can get. They will do that not for the taxpayers, this House or those who work for the business but simply for the company shareholders whom they represent and with whom their loyalty lies.
The House of Commons has far higher standards and far stronger commitments. We should have the right to vote on the issue and the House should have a clear prospectus of what is on offer. Until we do, I hope that no Opposition Member will encourage the Minister in the foolishness of his endeavours.

Mr. Nigel Waterson: I am pleased to have an opportunity to speak in this important debate. It has been interesting, not least because Opposition Members have given us a re-run of many themes and prejudices of old Labour. As the definitive voice of new Labour will wind up for the Opposition, it will be interesting to see at the end of the debate how the two philosophies are reconciled.
I shall make four main points. First, we must view the proposal as a natural progression. HMSO has had a sweep of history of some 200 years or more, but in terms of its recent history, we have been told that, in 1980, it began to recover its costs and some two years later, Government Departments were liberated from the obligation to purchase from HMSO. So competition with the private sector has been a fact of life for the organisation for the past 10 years or more. In 1988, it became an executive agency, so there is nothing new about the current proposal. It is the natural result of all that has gone before, particularly in the past 10 or 15 years.
Secondly, hon. Members on both sides of the House have echoed the view that, whatever happens to HMSO, it is important to have clear safeguards about the future role of the stationery office, especially vis-à-vis this House and the other place. My right hon. Friend the Chancellor of the Duchy of Lancaster made it clear the other day that he is determined that whoever buys the stationery office will maintain its independence and integrity. That is important for all those participating in the debate. It is also clear from the points that have been


canvassed in the important exchange of letters between Madam Speaker and my right hon. Friend that an eventual buyer must be fully acceptable to this House.

Mr. Dalyell: Let us suppose that, at first, the buyer fulfilled all those criteria and the sale was accepted in good faith but then, for some reason that we cannot determine here and now, things went sour and became less and less satisfactory. Can the hon. Gentleman imagine himself or one of his colleagues on the Government Front Bench coming along to this House and saying, "Sorry, we have no means of producing parliamentary documents"? That scenario is not fanciful; it could too easily happen.

Mr. Waterson: I am grateful for the opportunity to deal with that point. I have no dreams of being on the Front Bench, but if I were, I cannot imagine that scenario arising. This is a matter not between the Government and HMSO, but between this House and another place and the stationery office in its new incarnation. All Opposition Members have signally failed to appreciate the importance of a contractual relationship. At present, the arrangement between this House and HMSO does not come close to such a relationship. As my right hon. Friend explained, there will be a series of detailed provisions not only on the existing position but on any future changes in the stationery office's structure or operation, on the basis that it would have a paramount obligation that those would be subject to Parliament's requirements. As the hon. Gentleman knows, any contract would include two possibilities: first, to sue for damages; and, secondly, if a breach or breaches were sufficiently serious, to withdraw from the entire contract and claim a "fundamental breach", to use lawyers' jargon.
Beyond that, as I said in an intervention on my right hon. Friend, considerable commercial pressure will be placed on the stationery office's buyer to ensure that the relationship does not go sour. The right hon. Member for Bishop Auckland (Mr. Foster) said that such a relationship was a key factor in any privatisation. I am the first to appreciate that that is a two-edged sword, but it gives the ultimate buyer a substantial commercial incentive to ensure that the relationship does not "go sour".
To continue with the question of safeguards, it is also important that this is a fully transparent process. As my right hon. Friend said, the shortlist of bidders will be published and officials of this House—not members of the Government—will be involved in the selection. He went further and listed the wide range of consultations that will take place, not only through the usual channels, but more generally in the House and no doubt in another place.
As I said in response to the intervention of the hon. Member for Linlithgow (Mr. Dalyell), the whole process will result in a detailed, legally binding and enforceable contract with the newly privatised stationery office, spelling out in great detail a range of enforceable obligations including, as I have said by way of an example, a provision that any future changes in its operation should take account of Parliament's requirements.
As a lawyer, I am the first to appreciate that the devil is in the detail. However, commercial contracts of that type are entered into all day, every day, throughout the

commercial sector, and it appears to me bizarre in the extreme to suggest that there are especially insuperable obstacles to legal draftsmen about what is now proposed, especially when, in addition to the supervision of the lawyers involved, there will be such a heavy weight of other, as it were, back-seat drivers looking over their shoulder to ensure that they get the detail right to protect the requirements of the House—and all that, with the recourse to law as a back stop, should anything go especially wrong. Further, we have spoken already about the protection for existing staff under TUPE, which would mean that their existing terms and conditions would apply.
We have heard a great deal from Opposition Members about that apparent poll of employees, suggesting that 95 per cent. of them oppose the idea. Is that a surprise? If one tells people that they are likely to be hit on the head by a meteor, they will start worrying about being hit on the head by a meteor. I wonder in what terms the options available to HMSO were described to the work force.
The third main issue is: what other options exist for HMSO? We have heard some airy-fairy talk in the debate about foreign contacts, developing business overseas and so on, without any true recognition of the scale of capital outlay that might be required. We have heard about a shrinking Government market. We have also heard how, between 1990 and 1994 alone, HMSO's turnover declined by more than 10 per cent. There are job loss implications in that trend; there already have been job loss implications, and it would be foolish and irresponsible of the House not to recognise that truth.
The fourth issue is the freedom that may be introduced to the stationery office's current operations—freedom from the constraints of Government and the public sector; commercial freedom to embark on those new and exciting markets that hon. Members spoke about. The stationery office and its employees should not look nervously to the past; they should look boldly to the future. The vast experience and expertise of HMSO's staff, coupled with the efficiencies that have been won in recent years, should make it, on any view, a major player in any market, national or international.
However, as I have said, access to capital—the freedom to raise capital where and how it wishes—is essential to grow that business, like any other. In other sectors, we are witnessing the development of the private finance initiative, producing hospitals and the like, and moves to give grant-maintained schools the opportunity to borrow on the open market. That is all part of the process, which is so much a feature of the Conservative philosophy, of setting free organisations which have a role in the modern world, and which have the expertise and the commitment of their staff, but which are held back by the dead hand of the public sector.
In that context, I might mention the possibility—only briefly, Mr. Deputy Speaker, because, were It do otherwise, you would no doubt call me to order—

Mr. Deputy Speaker (Mr. Michael Morris): Order. The hon. Gentleman already seems to be wandering out of order, so I should be grateful if he would stick to the subject of debate, as there are other hon. Members who wish to get in.

Mr. Waterson: I was mentioning only the very same arguments that we have heard in favour of what is proposed for HMSO. Many of them could apply equally to the Royal Mail.


Finally, a significant feature of the debate has been the attitude of Opposition Members. They have opposed every privatisation, whether it be of electricity, water, British Telecom or gas, and apparently propose to oppose this one. We have heard about the railways from the right hon. Member for Bishop Auckland, who was not regarded as out of order in making that argument. There was no pledge to renationalise—

Mr. Deputy Speaker: Order. The hon. Gentleman may be a lawyer, but he does not challenge the Chair like that. I should be most grateful if he would respect the Chair and conclude his speech, as he would appear to be doing, on the subject before us.

Mr. Waterson: I am sorry, Mr. Deputy Speaker. I was not intending to challenge your judgment, but I was suggesting that a more general issue about privatisation has run as a theme through the debate. Although I would be the first to accept that we are discussing a specific privatisation, many of the themes are common to other sectors.
However, I was drawing my remarks to a conclusion. There was no pledge to renationalise British Rail. There is apparently no pledge to renationalise HMSO.
You and I are very familiar with the process, Mr. Deputy Speaker. It begins with Opposition Members objecting strongly to a proposal to privatise. It moves on to the rubbishing of every aspect at each stage of the process, seeking to sow unjustified fears in the minds of employees, potential investors and the electorate. It continues with carping from the sidelines while the hard work proceeds and the enterprise goes ahead. The criticism becomes more muted as the privatisation is deemed a success. Labour party policies are fudged and any commitment to renationalise is quietly interred at dead of night in that rather large socialist graveyard with which we have all become familiar. Finally, there is an acceptance—usually tacit—that once again privatisation is here to stay, bringing tangible and lasting benefits to consumers, taxpayers and employees.

Mr. Michael J. Martin: The hon. Member for Eastbourne (Mr. Waterson) spoke at some length about privatisation, but this debate is not about privatisation in the usual sense. If the Government were serious about privatising HMSO, they would present a Bill to the House so that all hon. Members could debate the matter and consider the problems in detail both in Committee and on the Floor of the House.
The Chancellor of the Duchy of Lancaster is an honourable man—I have dealt with him before on transport—and he should admit that he agreed to a debate on the privatisation of HMSO, without a vote, only after sustained pressure from hon. Members and the Finance and Services Select Committee. I believe that there should be a debate with a vote—and that it should be a free vote. We are discussing the provision of services to the House. The decisions that we make in the months ahead will affect the future work of Members of Parliament, particularly Back Benchers.
When I was elected to the House in 1979, I did not realise that I could receive a transcript of the proceedings of Parliament within 12 hours of a debate taking place. Over the years, I have realised what an asset that facility is, not only to Ministers and Front-Bench spokespersons

but to Back Benchers like me. When constituents write to me and ask for my views and those of other hon. Members about an issue, I can reassure them about the matter and send them a copy of Hansard within a few days of its being debated here. The service is very useful for Back Benchers who do not have the civil service back-up Ministers enjoy.
HMSO's services were developed over hundreds of years, and I do not think that we should surrender them willingly. We have an old saying in the engineering profession: "If it works, don't fix it". Why are we seeking to fix something that works very effectively for us and for the people of this country?
Many hon. Members have spoken about the control that Parliament exercises over the pricing of Hansard. Not so long ago, the Administration Select Committee—of which I am Chairman—reached the unanimous decision that Hansard should be produced more cheaply for those who supply libraries, schools, universities and other academic institutions. That is possible only if we retain control of HMSO.
It must be cause for concern that the service might be delivered into the hands of private printers. Unlike some of my hon. Friends who want to speak in the debate, I have never worked in the printing industry. It has always seemed an uncertain industry—Maxwell comes to mind—of ownership changes and asset stripping. I do not know whether the famous Lord Hanson had any influence over it—it is always argued in the tobacco industry in my Glasgow constituency that, if a company is profitable and has good industrial relations, there is no need to worry about it— but lo and behold, because a company was on a certain site, a new owner could take away the facilities that it provided for the sake of making a quick buck.
At present, HMSO is an excellent asset with printing facilities across the river at Bermondsey. We might negotiate a contract with another printing company, but what will happen if the facilities move from Bermondsey to another part of London? That would make it difficult for Hansard to be delivered on time. We all know the problems of road transportation in London.
Hon. Members know that space in the House is precious; it is used by Officers of the House, Members, back-up staff and for many other purposes. The advantage of the facilities across the river is that they provide printing and storage. No contract, no matter how tightly it is drawn up, could ensure the continuation of those facilities.
The Canadian Parliament handed over its printing service to a private contractor and it is now an absolute disaster. New Zealand is also experiencing difficulties with private contractors, as are many other Parliaments. I am not arguing about privatisation—my views are well known—but, like every other hon. Member, I want to ensure that we keep the good facilities that we have. The dedicated Hansard staff service all the Committees and work night and day to ensure that the printer receives the material.
When there is a crisis, the House appreciates the work of Hansard. I recall the Falklands and the Gulf war when Ministers and Opposition spokesmen made certain comments that we wanted to see on the record before we proceeded—and we could within hours of the House rising. We have to ask ourselves whether we want to risk losing that facility. I do not want to run that risk and I shall vote against it.


We should improve our existing facilities. Putting our proceedings on the Internet and improving computer links so that more people can read about what we do in Parliament has been mentioned. The press has failed abysmally to cover the work that we do. The dedicated work that Back Benchers and Ministers do receives no press coverage, but people want to know about various issues that affect their daily lives. We must have a debate and a free vote.

Mr. David Lidington: I shall begin by taking up one theme that was mentioned by the hon. Member for Glasgow, Springburn (Mr. Martin)—public access to the documents produced by HMSO, notably Hansard, and the other papers it presently produces for the benefit of the House.
There will be considerable agreement on both sides of the House that the day-to-day coverage of Parliament provided by newspapers and the broadcast media falls below the standard that is desirable if we want the electorate to be informed about the issues that are debated in the House and the arguments that are presented by both sides of it.
Earlier today, I received a letter from the Buckinghamshire county librarian expressing some concerns to which I hope my hon. Friend the Minister will he able to respond when he makes his welcome debut at the Dispatch Box. I believe that that librarian speaks on behalf of other, similar, services in expressing anxiety about the possible impact of the proposals on the availability of Hansard and other parliamentary papers to the general public through libraries.
As the hon. Member for Springburn said, the present policy is to supply public libraries with HMSO publications, including reports of the House's proceedings, at discounted prices, with the aim of securing a properly informed electorate. I hope that my hon. Friend the Minister can reassure me that the Government intend to make binding arrangements for the discounts to be continued after privatisation.
I have no objection in principle to the privatisation of HMSO. It is, in my view, somewhat otiose to argue that only through the public sector can the House expect documents to be delivered on time and printed accurately. Those of us with experience in the private sector of the way in which our printing and publishing companies deal with documents such as annual reports, or companies' financial results, will know that that sector is perfectly capable of meeting the demanding standards that the House would wish to impose on it.
Some Opposition Members have tended to overlook the fact that the contract to produce parliamentary documents on behalf of the two Houses would be highly prized. The company would have every commercial incentive to ensure that it delivered a service to Parliament that would enable it—the publisher and printer—to boast about that service, and about its continuing contract with the House of Commons, when seeking business with other clients both here and abroad. I expect the pressures of the market to ensure the delivery of the high-quality service that the House expects.
I was grateful for the assurances that my right hon. Friend the Chancellor of the Duchy of Lancaster was able to give about the procedure that will apply to the details of the proposed privatisation. I hope that Ministers will be able to give us more details of their thinking before long. I believe that it was the right hon. Member for Bishop Auckland (Mr. Foster) who spoke of the possible risk of a foreign publishing company's securing the business; I do not think that that, of itself, is to be feared. I imagine that, in any case, under European Community law it would be illegal for the Government—or, possibly, the House of Commons—to discriminate in favour of a United Kingdom company as against a company based in another European Union state.
This, however, is the important point. Will my hon. Friend the Minister assure us that all hon. Members will be informed in good time of the nature of the criteria that will apply in the judgment of the individual bids that are submitted?

Mr. Dalyell: With a foreign company, what would happen to the stringent security arrangements that now apply to the employees of HMSO?

Mr. Lidington: As I understand it, employees of a private sector company, whether it is British-owned, German-owned or American-owned, would be subject to the same process of law and to the same contractual obligations. Given the increasingly international nature of the publishing business, those are constraints of which the management of any company that sought business the Government and Parliament might offer would be well aware.
I hope that my hon. Friend the Minister will be able to reassure me on the points that I have raised. The principle of privatisation seems to be sensible. We are discussing a business with a considerable turnover, and the arguments adduced by my right hon. Friend the Chancellor of the Duchy of Lancaster for giving it the freedom and opportunity of the private sector are sensible, but we must ensure that we get the detail right, so that we can carry the measure forward with the full support that it deserves.

Mr. Tam Dalyell: Many hon. Members wish to speak, so I shall ask the Minister just two questions. First, a factual question. With whom has he discussed the matter in relation to the staff? I am told that it was not discussed with the Amalgamated Engineering and Electrical Union; the Graphical, Paper and Media Union; or the GMB. I am told that he had one somewhat cursory meeting with the Civil and Public Services Association; the Institution of Professionals, Managers and Specialists; and the National Union of Civil and Public Servants, but that, other than that, there has been no contact. When the Minister replies, can we have the factual truth—or untruth—of that situation?
Secondly, I return to vetting. We are talking about some of the most sensitive documents that our country handles. Huge amounts of money could be made. Are we entirely, as the hon. Member for Aylesbury (Mr. Lidington) suggested, to rely on contract law? What will happen about the vetting of individual employees? With the Budget statement and equally sensitive documents, it is not sufficient for the firm to


give a general blanket assurance. There must be very clear track records of employees who are to handle such matters.
I should like answers to those two questions.

Mr. Gary Waller: Much attention has been paid today to the interests of employees of HMSO and of this House and the other place. That is quite right, but I want to say a few words about the interests of the ultimate customer—the user of official information—and the dissemination of that information using electronic means. I have no doubt that, in future, it will become common for such information to be conveyed in that way, for it to be manipulated and for added-value services to be applied to it.
The Information Committee of the House, of which I am Chairman, has already given some attention to the matter of parliamentary copyright, not specifically because the matter of privatisation has arisen but because we recognise that copyright is in many ways the key to the way in which information is used. It must be a key to open doors, not lock them. I know that some publishers are concerned that it is being used to lock doors rather than open them.
I shall speak about Crown copyright this evening, because I know that my right hon. Friend the Chancellor of the Duchy of Lancaster is planning—early in February, I believe—to complete a review of the matter and that his views will then be published. Leading firms of legal publishers such as Butterworth, Sweet and Maxwell and Longman, and specialist electronic publishers such as Context, with whom the House has an agreement for the electronic dissemination of POLIS, are concerned about what they describe as
the limitations that HMSO has been attempting to impose on our freedom to reproduce materials which state what the law is and how it is administered.
Few matters are as important as freedom of information in relation to the law. Ignorance of the law is no excuse and it is vital that there should be no barrier to access legal information.
I have one or two questions for my hon. Friend the Minister, who is to wind up. If the privatised stationery office is required to obtain a licence to exploit Crown copyright from that part of HMSO which remains in the public sector—I assume that it will—will that licence be offered to the stationery office on the same terms as those on offer to competing private sector publishers? Will the stationery office be in a different position from others who add value to official information? What, if any, exclusive access will the stationery office have to Crown copyright materials? Will it operate in the same way as any other publisher of information in this area or will it have a special, privileged position?
I have a specific question about the statute law database project. Work has been continuing on that database for some time and I understand that the project will be completed next year. Will the stationery office have an exclusive right to offer services from that project to the public or will an open licence be available to any suitably qualified private sector publisher? I hope that all those important matters will be addressed.
I know that my right hon. Friend the Chancellor of the Duchy of Lancaster has already said in evidence to the Select Committee on Finance and Services and in his

helpful comments to the House that his instinct is for open government. That is encouraging, and I hope that, when he makes his decision about the use that will be made of copyright, he will demonstrate in a tangible way that he is determined to put his words into practice.

Mr. Robert Litherland: I have been connected with the print industry for 51 years. I started in the industry as a boy of 14, and I am rightly proud of the fact that I am a sponsored member of the Graphical, Paper and Media Union. My prime allegiance is to the workers who are affected by the privatisation policy.
The question that goes begging is, "Why privatisation at all?" The Minister repeatedly recognised the quality of service and the efficiency of HMSO's workers and paid tribute to the management and staff for their commercial success in recent years. Why the big hurry? Why are we discussing a deadline of the summer of 1996?
From the Minister's speech and from his statement last week, it appears that the arguments are excuse rather than good reason. It all boils down to the Government's policy of privatising public concerns however successful they may be. Their dogmatic approach is that HMSO must be privatised although, as hon. Members in all parts of the House have said, it is working and providing a good service.
A great deal of money has gone into the streamlining of this successful enterprise and I query the investment. Is it another example of the fattening-up process that takes place before every privatisation? HMSO is a free-standing organisation that has never had any history of leaks of highly sensitive details and that should be allowed to compete in the outside market and has the capability to do so—but to this Government that would be heresy.
What is dismaying—hon. Members have called for it tonight—and needs extra debate and questioning is the Minister's inability to give complete assurances on whether future private owners will sell on after purchase. He cannot give an assurance on what workers' pensions will be, whether they will be secure and whether all the terms and conditions, such as pay, holidays, health and safety, will be met. Can he give an assurance that a future owner—my hon. Friend the Member for Linlithgow (Mr. Dalyell) mentioned it—could not be a foreign printer, perhaps a powerful German printer?
What about the most precious commodity of all: the workers. What will they make of the Minister's remarks? Will the proposal be to their benefit in the long run? I and, I am sure, they come to the conclusion, "Not a lot". They are not fools, Minister. They have witnessed the redundancies following the privatisation of gas, water and electricity.
The fattening up may be good for the fat cats, but it will be disastrous for many workers. What a prospect that is to offer workers just before Christmas, when they will sit with their families and ponder what next year will bring and what predicament they will be in. As has been said, the results of a ballot gave workers' views loud and clear: 95 per cent. voted against privatisation.
From the Speaker of the House down to the shop floor, concern is being expressed. The letter from the Chancellor of the Duchy of Lancaster to Madam Speaker states:
I recognise, and am sympathetic to, the concerns which you raise about the service which HMSO provides to the House and how to safeguard it for the future.


I shall not give a long quotation, but it continues:
No supplier would want to be associated with a failure to deliver the services required by such a noteworthy customer. Done well, the Parliamentary business would be the best possible advertisement for the company. Done badly, other potential customers would take flight.
To me, that reply does not reek with confidence. What would happen if the new owners could not meet their obligations? Perhaps, in his winding-up speech, the Minister will explain who would be accountable.
As has been recognised, there is cross-party concern for HMSO's future. We wonder where privatisation will end when, now, it is on our very Parliament's doorstep.
I am getting the nod to end my speech, but I for one, unlike the Chancellor of the Duchy of Lancaster, do not believe that a relationship with the private sector can be stronger or better than what we have now. I agree with the argument that there should be further debates and that the matter should go to a free vote.

Mr. Peter Mandelson: This debate has been useful. It has revealed the paucity of the Government's argument on the privatisation of HMSO and exposed some serious and justified concerns among not just Opposition Members but Conservative Members. It has focused attention on employees' understandable anxieties. I hope that the Minister will respond in particular to the questions raised by my hon. Friend the Member for Linlithgow (Mr. Dalyell).
The debate has left unanswered a host of legitimate questions about the future course of our parliamentary proceedings and work if privatisation goes ahead. I perfectly understand why the hon. Member for Norwich, North (Mr. Thompson) has, as he said, decided to quit the House at the next election. He had some very strong things to say about the Conservative party.

Mr. Patrick Thompson: I ask the hon. Gentleman not to put a spin on what I may have said, and I hope that he will not misquote me further.

Mr. Mandelson: I do not want to count my turkeys or my chickens, but the hon. Gentleman had some harsh words to say about the Government's attitude toward public service. I share his views entirely. I will only say in addition that if he felt reassured by what the Minister had to say to him about job losses, he is very easily satisfied indeed.
As my right hon. Friend the Member for Bishop Auckland (Mr. Foster) made clear at the outset, the Opposition do not agree with this privatisation. We take that view not because we are opposed to all private sector involvement in the delivery of public services—I can reassure the hon. Member for Eastbourne (Mr. Waterson) on that point—but because privatisation for its own sake, regardless of economy, efficiency or effectiveness, simply cannot be justified.
The privatisation of HMSO is unwarranted on those three grounds. It is a needless rigamarole that involves great risks to the service that Parliament receives from HMSO. In all probability, it will leave everyone worse off or, at the least, dissatisfied—including, as I shall argue,

quite possibly the private sector purchasers too. In our view, the privatisation is a recipe for huge tensions, if not chaos, between the prospective private purchaser and its chief clients—Parliament and the Crown—as my hon. Friend the Member for Glasgow, Springburn (Mr. Martin) made very clear, and as my hon. Friend the Member for Norwich, South (Mr. Garrett) spelled out in his detailed and comprehensive speech.
This is of course the latest in a series of unjustified privatisations which have been pushed forward by the Government. One wonders where the Government's next lurch to the right will lead. Perhaps Madam Speaker herself will be next in the firing line. Perhaps she will be sponsored, rather as the speaking clock that says, "The time as sponsored by Accurist." We might hear, "Order—as sponsored by Securicor." That may be a joke, but then the Government are proceeding with the privatisation of the railways. If they can do that, anything might follow.
I come directly to what the Minister has described—he placed great stress on this in his original statement to the House last week—as the "point of substance" and the "nub of the issue". He maintains that, to safeguard jobs and expand job opportunities, HMSO should become a private sector company so that it can enjoy the freedoms of the private marketplace and avail itself of the opportunities that are provided by free competition, unshackled, unconstrained and uninhibited by the burdens at present placed on it by its public service and Parliament-related obligations.
I agree that that is the nub of the issue. On the surface of it—certainly as presented by the Minister—what he is setting out has some attractions to it, in his terms. In making his case, however, the Minister is being thoroughly disingenuous because the realities of the marketplace could turn out to be very different. As one hon. Member after another has made clear, we are not dealing with the privatisation of any ordinary business. If anyone had any doubt about that, Madam Speaker's letter to the Leader of the House and the 12 conditions which she set out make it absolutely clear that we are dealing not with an ordinary business but with an essential and highly complicated public service.
Let us examine the case that the Minister made last week and again tonight. He seeks to create the impression of a wonderful free market nirvana, which is set to liberate the imprisoned business of HMSO. In the next minute, he is anxious to spell out and emphasise that, in its work for Parliament and for the Crown, nothing will change and therefore the handcuffs will stay on; every protection, every peculiar standard and idiosyncrasy that we demand in this place, every vagary, every pressure, every timetable, every ebb and flow of parliamentary business will be met faithfully and on time by the newly privatised business.
That does not sound like commercial freedom to me in its accepted sense. It sounds like the sort of framework and conditions that are not linked to the costs, competition or considerations of profit, which are the basis of private business, but are instead fundamental to the provision of public service.
Of course there will be attractions to the private sector. The Minister has previously described HMSO as a valuable asset with substantial recent investment in plant and machinery. Who could gainsay the rich pickings there? But how long will that attraction last and how long


will the new owners' interest be sustained if the business is maintained in its present state, as the Minister has claimed and promised repeatedly tonight?
The Minister said in his original statement that the new owners will organise their business as they are told to do in order to safeguard HMSO's unique parliamentary and public service obligations. What other self-respecting private business is told by its customer which specific "nature and structure" its company will have, not only now but for all time? The Minister used that description.
According to the Minister, Parliament will even be entitled to lay down
the location of the press and the staff and the way in which the business is structured and organised."—[Official Report, 13 December 1995; Vol. 268, c. 993.]
He says that the business will not be broken up. The parliamentary press will be integral to the rest of the business and it will all stay as it is at the moment, so the Minister insists. According to him, the customer will be calling the shots about the supply of products in every respect. Some commercial freedom that. I do not call that an ordinary commercial freedom. I find it a very exotic definition of commercial freedom—if the Minister is to be believed. Of course we are entitled to wonder how far that will be the case and how his promises will be fulfilled in practice.
Let us not get on to the practice; let us dwell a little longer on the principle that the Minister enunciated in his speech. In relation to their official printing and publishing work, the new private owners—apparently—will be bound hand and foot by a Draconian, far-reaching all-embracing contract, the Minister claims, imposed by its core customers: ourselves and the Crown. Will these conditions, dictated by public service and Parliament's needs, really offer the privatised stationery office the full opportunities to roam, compete in the marketplace on an equal footing with its rivals, and pick up business as and when and where it wishes, as the tender document implies? I rather doubt it.
If something has to give in this arrangement, I think that I know what it will be. Will it be the company's commercial freedom or our publishing needs? I think that market forces will have their way and no slap on the wrist from us or attempted enforcement of our contract is likely to have any sway at all in the face of those overwhelming market forces, which the Minister has said—and advocates—as the proper conditions in which this new privatised business should operate.
The whole complicated and unnecessary exercise is a thoroughly misconceived and botched job from start to finish. It has been dreamed up by the peddlers of right-wing dogma who infest the modern Tory party. They change the name, change the status, introduce private shareholders, and clothe the whole thing in reassuring rhetoric, all as long as the private sector can be substituted in form and appearance for what is at the moment an extremely successful public enterprise.
That is the nub of the issue. The privatisation is not about safeguarding jobs and expanding job opportunities, as the Minister has claimed, but about protecting Tory dogma and advancing ministerial careers. The idea is to get one more privatisation scalp on the Government's belt, and, incidentally, many thousands of pounds more in the pockets of Coopers and Lybrand in the process, and then

to sit back as the whole thing proceeds to fall apart. Of course it will not be those on the Conservative Front Bench who will clear up the mess; it will be us.
I am not surprised that the Government have fixed the debate so that no vote can take place at the end of it. Too many of their own Back Benchers—we have heard from many of them tonight—know that the privatisation is a needless, pointless, wasteful exercise, which, in its haste and clumsiness, will result in Parliament, its authorities and staff having to spend more time, more energy and more money on getting the same or worse service than they get from the current arrangements. What on earth is the point?
On behalf of the Opposition, I welcome the Parliamentary Secretary to his new position. I hope that he will be able to give a darn sight better explanation of this crack-brained scheme and a much better justification of it than we have heard to date. I hope that the assurances that have been called for on timing and other considerations will be given, as my right hon. Friend the Member for Bishop Auckland requested. Better still, the Minister could do us all an enormous favour and announce to general relief all round that the Government have had second thoughts in the Tea Room and called the exercise off. If they cannot do that, let us test the opinion of Parliament and put the issue to a proper vote in the new year.

The Parliamentary Secretary, Office of Public Service (Mr. David Willetts): This debate has been a welcome opportunity for hon. Members on both sides of the House to express their views about the effect of the proposed privatisation of HMSO on services provided to Parliament.
The debate has arisen from a series of concerns which Madam Speaker herself expressed in her letter of 28 November, and to which my right hon. Friend the Chancellor of the Duchy of Lancaster gave a full reply in his letter of 12 December.
It appears that the hon. Member for Hartlepool (Mr. Mandelson) is not familiar with the fundamental points that my right hon. Friend made in his letter. It has been made clear before, and I am pleased to take this opportunity to repeat the point, that, for example, no supplier taking on the responsibility of a privatised HMSO would possibly want to be associated with the failure to deliver the services required by such a noteworthy customer as ourselves. There is an enormous potential for the House to ensure that it gets the services which it is rightly entitled to expect through a clear, enforceable and legally binding legal contract.

Mr. Mandelson: Where are the sanctions?

Mr. Willetts: The hon. Gentleman does not seem to understand the power of a legal contract in terms of the quality and the enforceability of service that it can bring. The sanctions would be available through law rather than through arrangements within the public sector. The sanctions would be explicit, legally enforceable, contractual arrangements.


We have already made it clear that it is ultimately for the House to set that contract. We will work with officials of the House to ensure that it reflects the issues that have been legitimately raised in the debate.

Mr. Michael J. Martin: It is all very well for the Minister to talk about a contract; but it is not a contract to deliver 20 pints of milk to the door of the House of Commons but one to deliver the record of the parliamentary proceedings. If that is held up even by a day, it can cause havoc and represents a great deal of work wasted by the dedicated Hansard staff.

Mr. Willetts: That is why the contract could make it clear, for example, that local overnight production facilities should be available close to the House. These matters should be made explicit in a contract. Although this is a matter for the House rather than for the Government, I would suggest that there is potential for the House to set out clearly and enforce more rigorously the standards that it is rightly expecting.

Mr. Garrett: The Chancellor of the Duchy of Lancaster said that the House would have a hand in the selection of the company to take over HMSO. How will that be done?

Mr. Willetts: Through Madam Speaker, we have invited officials of the House to become involved in all stages of privatisation, including the selection of the final winning tender.

Mr. Dalyell: Have they agreed?

Mr. Willetts: Perhaps I might carry on.

Mr. Channon: Will my hon. Friend give way?

Mr. Beith: Will the Minister give way?

Mr. Willetts: I give way to my right hon. Friend the Member for Southend, West (Mr. Channon).

Mr. Channon: I may be interrupting the right hon. Member for Berwick-upon-Tweed (Mr. Beith). When dealing with the position of members of staff of the House, would it not be wrong for them to take part in that sort of decision? Surely they will be observers of, rather than active participants in, any such Committee.

Mr. Willetts: This is ultimately a matter for the House—it is not a matter for the Government. I can only say that the Government have invited, through Madam Speaker, the officials of the House to become involved in the process. It is not for the Government ultimately to decide.

Mr. Derek Foster: rose—

Mr. Dalyell: Have they agreed?

Mr. Deputy Speaker (Sir Geoffrey Lofthouse): Order. The hon. Member for Linlithgow (Mr. Dalyell) must control himself. [Interruption.] Is the Minister giving way?

Mr. Willetts: I give way to the right hon. Member for Bishop Auckland (Mr. Foster).

Mr. Foster: I am sorry to intervene, as I know that the Minister's time is short. However, this is a crucial point.

My hon. Friend the Member for Linlithgow is asking whether the officials of the House have agreed to take part in such a privatisation procedure—yes or no.

Mr. Willetts: It is not for me to speak for the officials of the House. I have made clear on behalf of the Government that an invitation has been offered, but it is not for me to speak on behalf of the House. It would be impertinent for me to try to do that. That is why we have exchanged some important correspondence with Madam Speaker on this subject, but I am not going to try to tell the House how it should conduct its own affairs.

Mr. Beith: May I make it clear on behalf of the House of Commons Commission that the invitation that the Commission received was for officials to take part in a process by which a contract would be prepared? The Commission would be willing to allow the officials to attend such a meeting as observers only, to make clear what the interests of the House are, and not as participants. The Commission has not yet considered the invitation—because it is entirely new—to officials to be involved in the selection of a company that might be entrusted with such a contract. That matter has not yet been considered.

Mr. Willetts: It is very important that the House should be satisfied at all stages that the winning company meets the requirements that the House wishes to specify for the contract. That is ultimately a matter for the House, rather than for the Government. We, for our part, will do everything possible to ensure—

Mr. Grrett: Will the Minister give way?

Mr. Willetts: I am afraid that I must make some progress. There are a lot of other points that I wish to cover, and I have only eight minutes remaining.
One of the other matters raised was the question of TUPE, and the hon. Member for Clackmannan (Mr. O'Neill) asked questions on that subject. I can assure him that TUPE applies at the moment of transfer, and TUPE will apply in this case. There is no period of time attached to TUPE as it takes place at a specific moment. The reason why people reflect on a 90-day rule is that if any employer wishes to change the terms of employment of his or her employees, it is normally thought reasonable by the courts to offer that sort of period of notice. That is a separate matter from TUPE.
The hon. Member for Linlithgow (Mr. Dalyell) raised the issue of security vetting. If a Government Department contracting with HMSO has an important security concern, it will be perfectly free to specify exactly what security vetting of individual employees is necessary for it to publish such documents, as it does at the moment. The hon. Gentleman also asked about consultation with the trade unions. My right hon. Friend the Chancellor of the Duchy of Lancaster has already had one meeting with trade union representatives and he hopes to have further meetings with them in the new year.
The hon. Member for Norwich, South (Mr. Garrett) and my hon. Friend the Member for Aylesbury (Mr. Lidington) asked me about the arrangements for ensuring that the quality of public debate was encouraged—something about which both sides of the House care—by continuing the current arrangements whereby public libraries received government documents


at a discount. I am pleased to be able to give my hon. Friend the assurance that those arrangements will continue.
Underneath the variety of specific points raised in the debate, perfectly legitimately, there was a deeper problem. The problem is that, for the past 15 years, every time we have explained the merits of privatisation, the Opposition have steadfastly refused to understand them. The fears voiced by the Opposition have been proved false by events. Yet again, we had today the threadbare arguments that we have heard before every privatisation. The right hon. Member for Bishop Auckland implied that private business men were sleazy and could not be trusted with money. We were told that the security requirements were such that it would be impossible for the requisite standards to be met by a private contractor. I must tell hon. Members that we can be proud that many of the world's banknotes are printed by private security printers in this country.
There is an assumption that only public ownership will do. There is an assumption that if one has a public policy objective, one has to own the means of production, distribution and supply and that, otherwise, one has no means of meeting those public policy objectives. That is our fundamental disagreement with the Labour party and it remains as clear now as it was when we embarked on privatisation 15 years ago.
Labour Members now ask why HMSO cannot enjoy greater market freedom to compete with the private sector while remaining within the public sector. That argument at least reflects a recognition that things cannot carry on as they are. Anyone who looks at the figures for HMSO over the past few years can understand why. In 1990, its turnover was £389 million. In 1994, its turnover was £351 million. In 1990, it had 3,400 employees; it now has 2,900. As currently constituted, subject to all the inevitable constraints of the public sector, the business will not be able to thrive. We offer the best prospect for the employees of HMSO to be part of a growing and expanding business.
It would simply not be acceptable to allow a public sector trading organisation, which borrows from the national loans fund—it has, incidentally, £30 million of public sector borrowing outstanding at present—to go out and compete with private sector printers or publishers. It would not be reasonable for a body that would not pay corporation tax to compete in the private sector. It would not be reasonable to expect Ministers, who are accountable to the House, to allow HMSO to take on commercial risks when those risks would ultimately be borne by the taxpayer.
The only way in which HMSO can enjoy the freedom that the Opposition now say they wish it to enjoy is for it to be part of the private sector. That is the only credible way forward. At the moment, HMSO faces increasing competitive pressure in its public sector marketplace. We have heard claims that the Ministry of Defence is now looking to market-test its publishing and printing requirements. I am not aware of that taking place as a result of the prospective privatisation of HMSO. It is what is going on throughout the public sector. The public sector is free to choose where it goes to purchase its printing and publishing services.
HMSO is competing with private bodies for public sector work. As currently constituted, it has no reciprocal freedom to go out and compete with private sector providers for

business in the private sector. I do not believe that any hon. Member, on careful consideration of the arguments, could possibly imagine that HMSO could remain in the public sector and have such freedoms. All the Opposition Members who have said that they wish it to have greater freedom while remaining in the public sector have made as clear a case as one could possibly imagine for the privatisation of HMSO as the only way forward.

Mr. Dalyell: On a point of order, Mr. Deputy Speaker. It is the tradition of the House that the Department of the Clerk of the House is not brought into controversy. May I suggest that you bring to Madam Speaker's attention what has been said tonight and that she might take a statement on the position?

Mr. Deputy Speaker: I can help the hon. Gentleman. The Speaker has already ruled on the matter. I thought that the hon. Gentleman might have been aware of that.

It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.

Orders of the Day — BROADCASTING

Ordered,

That Mr. Patrick McLoughlin be discharged from the Select Committee on Broadcasting and Mr. Derek Conway be added to the Committee.—[Mr. Bates.]

Orders of the Day — PUBLIC SERVICE

Ordered,

That Mr. Peter Ainsworth, Mr. Hartley Booth, Sir Sydney Chapman, Mr. Jim Cousins, Mr. Nigel Evans, Mr. John Gunnell, Mr. David Hanson, Mr. David Hunt, Sir Peter Lloyd, Mr. Giles Radice and Dr. Tony Wright be members of the Select Committee on Public Service.—[Mr. MacKay, on behalf of the Committee of Selection.]

Orders of the Day — PETITION

Nursery Schools (Rochdale)

10 pm

Mr. Jim Callaghan: I beg to ask leave to present a petition which reads:
To the House of Commons.
The Petition of the residents of Rochdale Borough and other places
Declares that the Government's proposals for funding the education of under five year olds by a system of vouchers exchangeable for a sum payable to an institution would have a negative effect on the provision of education for the five year olds in the Rochdale Borough and would put at risk the existing eight nursery schools.
The Petitioners therefore request that the House of Commons urge the Prime Minister and the Secretary of State for Education to reconsider the proposals for funding nursery education via the system of vouchers with a view to establishing a fairer and more efficient way of providing children under five with the best possible education in their early years.
And the Petitioners remain.
There were 2,550 petitioners, and the petition was signed by Colin Lambert and others.

To lie upon the Table.

Orders of the Day — The Lizzards, West Drayton

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Bates.]

Sir Michael Shersby: I am grateful for the opportunity to raise a matter of great importance to my constituents who live in Yiewsley and West Drayton—the unauthorised and non-conforming industrial activity taking place on a 22-acre site in the metropolitan green belt.
I wish to declare an outside interest in that I am president of the London Green Belt Council, a voluntary association of residents' associations around London. My position is honorary and unpaid.
The site to which I refer is known locally as The Lizzards. Access to it is via Tavistock road and Trout road, Yiewsley. The activity about which my constituents have complained is the reprocessing of waste materials and the crushing of concrete. I am advised on good authority that much of the waste material is being imported from other contractors by a company known as Towerway Ltd.
The waste apparently includes earth, blocks of concrete reinforced with steel and similar material which is thought to come from motorway construction works. My information is that Towerway Ltd. makes a charge for receiving this material and is engaged in its resale. I am advised that Towerway claims to occupy the land under licence from a company known as Guinea Enterprises Ltd., which is registered in the Isle of Man. The directors are Isle of Man residents and are not known to the local planning authority.
The use of The Lizzards for this industrial activity came to my attention in the spring. A number of my constituents living in Tavistock road became aware of an unusually large number of heavy lorries using their road. The lorries were loaded with soil and concrete and entering the site by means of a makeshift road, which had been bulldozed across open land and given a temporary tarmac surface to enable entry. People living in Trout road also reported increased heavy lorry traffic. They have complained to me about a misuse of green belt land and an intolerable increase in heavy traffic along a residential road.
I immediately raised the matter with officers of Hillingdon council planning department, the local planning authority, who confirmed that they had informed Towerway Ltd. that its activity was non-conforming. As a result, on 24 April this year, the company applied for retrospective planning permission. Although, on 4 July, Hillingdon council rejected the application, the company disregarded the planning control and continued its activities. As a result, during the long hot summer that followed, my constituents continued to suffer from the noise of an unending procession of heavy lorries thundering past their homes from as early as 6.30 am, with an accompanying spillage of soil and other material on the public highway.
My constituents also suffered the loss of the amenity constituted by the green belt land, which is part of the Colne Valley park and intended for the public's general enjoyment. I inspected the site several times during the summer months and was saddened to see how large piles

of soil had formed a large bank adjoining the bridleway, trees had been crushed, and an amenity that has been enjoyed for many years by local people who like to walk their dogs and enjoy the open landscape had been spoilt.
In spite of local planning officers' efforts, that company continues an unauthorised and objectionable activity in defiance of our planning laws. May I tell the House about the traffic volume? On Friday 15 December, no fewer than 107 vehicles travelled up and down Tavistock road between 6.30 am and 5 pm. On Saturday, the traffic started at 6.40 am and continued until just after 3 pm. Today, the traffic started at 6.40 am and, by mid morning, 23 lorries had gone up and down the road. How are my constituents to sleep, given the noise from those heavy lorries? It is an intolerable level of traffic on a quiet, mainly residential street.
The reprocessing activity is unlicensed and does not conform to regulations made by the London Waste Regulation Authority in accordance with the Environmental Protection Act 1990, which deal with transporting and recycling waste. I am advised that the authority has threatened prosecution. As a result of my interest in the matter, I received a letter from the planning and property consultants acting for Towerway Ltd. It claims that the company is engaged in a major restoration job by restoring the land to agricultural use without recourse to public funds and that residents should acknowledge that they live on historically commercial access roads and that lawful traffic and commercial activities share their right to be there.
From the inquiries that I have made, I can demonstrate that that is not a lawful activity and that Towerway Ltd. has no right to be there. The site in question was originally owned by the Henry Boyer trust. It was transferred to Guinea Enterprises Ltd. in the recent past but no transfer has been registered at the Land Registry. Before 1947, part of the site was filled or overfilled with a variety of types of refuse, including tyres, concrete and scrap metal. In 1947, the former Middlesex county council gave permission for gravel winning and excavation. There was also a requirement for the treatment of the filled land, not all of which may have been carried out.
In 1964, there was a consent by the Middlesex county council for the clearance of tip refuse, and that material has been extracted since then for road construction. I am advised that Towerway is not removing tipped refuse alone, but is engaged in reprocessing and tipping, for which planning permission is required. As I have mentioned, no such planning permission has been granted, so now we have an unauthorised activity on land that, until earlier this year, was valuable open space, acting as an important lung in the green belt.
Many of the activities of Towerway are, I am told, not new to the local planning authority, which has already had to cope with similar activity on green belt land at several sites, including Bungalow farm off the Bath road at Longford in the south of the borough. As a result of that case, there was a public inquiry and an appeal by the company was dismissed. Enforcement proceedings are now in progress. Hillingdon council is taking appropriate enforcement action in the case of Towerway's use of The Lizzards. However, that is a lengthy process and meanwhile the non-conforming use continues, to the detriment of local residents.


I have suggested to my hon. Friend the Minister—this is one of my principal reasons for mentioning the matter in the House—that the provisions of the Town and Country Planning Act 1990 are inadequate to solve the problem of non-conforming users who completely disregard the established planning controls. It is difficult for planning authorities to cope with well-informed operators who know how to play the system. If they are registered offshore, they can attempt to avoid control by simply changing their name when action is taken. They are what I can only describe as "chameleon companies".
I shall explain to the House the way in which those companies avoid control. When an enforcement notice is issued, there is a right of appeal, which takes 12 months or more to be heard. Meanwhile, the offending activity continues. The stop notice procedure was intended to be an effective emergency remedy in such circumstances, but is inadequate because a local planning officer cannot effectively enforce the notice on the operator, who usually keeps a low profile and is not easy to identify or to find on the site.
It is no use trying to enforce a notice against a lorry driver entering or leaving the site. The stop notice must be effective against the operator in person. Such people make it their business not to be available for that purpose. It can be difficult to demonstrate in a criminal court that they have acted in breach of a notice if they control activities off site.
If the operator is on site, how does the enforcement officer tackle him? He is armed with little more than his pen and his personality. He has no power of arrest. He would have to be accompanied by a police officer. As we all know, police time is valuable; an officer is not always easily available for that purpose.
At Bungalow farm, Longford, where a stop notice was served at 7 am, another lorry entered the site shortly afterwards. The driver was cautioned, but then he vanished and the unauthorised activity continued. If the driver could have been arrested by a police officer, it would have been a huge deterrent. He might have been subject to a fine of £20,000 in a magistrates court and an unlimited fine in the Crown court. However, the offence was not an arrestable offence.
I wonder, therefore, whether my hon. Friend the Minister will consider discussing with my right hon. and learned Friend the Home Secretary the possibility of making such persistent and flagrant disregard of a stop notice subject to a custodial sentence. Another possibility might be to give a local authority power to take physical steps to stop the breach, perhaps by confiscating equipment or preventing access to the site in question by installing structures or barriers to the site off the public highway.
Knowing my hon. Friend the Minister as I do, I hope that he will give his careful consideration to the difficulties that are being experienced by my constituents, and which I have described tonight. I hope that he will use all of his influence to support the local authority and, if he can, help to bring relief to my beleaguered constituents in Yiewsley and West Drayton.

The Parliamentary Under-Secretary of State for the Environment (Sir Paul Beresford): I am grateful to my

hon. Friend the Member for Uxbridge (Sir M. Shersby) for raising this particular difficulty. I understand from his description the difficulties experienced by his constituents who live anywhere near the sites. They are inevitably affected by the heavy lorry movements, the noise, dust and disturbance. It is particularly annoying for them when they believe that those activities are not within the law, as no planning permission was applied for.
My hon. Friend will know that I cannot comment on the merits of the allegedly unauthorised activities that are taking place on the sites, or on the planning enforcement action that the council is taking now or may take in the future. It is possible that the matters may be the subject of some form of appeal to my right hon. Friend the Secretary of State.
Nevertheless, there are lessons to be learnt. We suspect that so-called cowboys have set out to ride roughshod over the planning control regime. In 1989, the planning enforcement regime was reviewed thoroughly. That review was quickly followed up by the Government, and the Planning and Compensation Act 1991 was enacted as a result.
Authorities have a versatile and effective tool kit for dealing with the whole range of unauthorised development and I encourage local authorities—particularly this one—to utilise that to the full. I suspect that the local authorities may be able to go a little further in certain areas.
One of the most important provisions in the 1991 Act is that enabling authorities to counter a particularly harmful breach of control. They may seek an enforcement injunction in the High Court or the county court. If the courts grant an injunction, it will be directed at named individuals, or at companies, who will be required to stop the activity involved in the alleged breach of control. An injunction can also be sought if an authority anticipates that a breach of control is about to take place. Anyone named in an injunction who does not observe its requirements will usually be in contempt of the court. Continuing contempt may result in a term of imprisonment.
To make it easier to obtain that type of injunction, a special procedure enables an authority to obtain an injunction against someone whose identity is unknown. That can assist authorities greatly if they are dealing with a fly-by-night operator who presents a false identity or who is adept at changing his or his company's name. I can remember a local authority resorting to long-range camera photography in order to nail certain individuals.
An authority may issue an enforcement notice and reinforce its effect with a stop notice. There is no right of appeal to the Secretary of State against a stop notice, so it can effectively prohibit an unauthorised activity almost immediately. The maximum summary penalty on conviction of not complying with the prohibition in the notice was increased from £2,000 to £20,000 by the 1991 Act.
We sometimes hear criticism that planning authorities are reluctant to use a stop notice because it may result in their having to pay financial compensation to the person whose activities are prohibited by the stop notice if that person succeeds in an accompanying enforcement appeal to the Secretary of State. In fact, compensation would not be payable if the enforcement appeal succeeded on the grounds that planning permission


should be granted. If the appeal succeeds on one of the other legal grounds in section 174(2) of the 1990 Act, some compensation may be payable, depending on the particular circumstances.
I believe that planning authorities do not need to fear having to pay compensation if they draft their enforcement notices correctly in relation to planning law and the facts of the alleged breach. We know that enacting planning legislation is not enough. The Government's policy and procedural guidance to planning authorities also play a part. My Department's planning policy guidance note 18, entitled "Enforcing Planning Control", emphasises that the Government do not condone any wilful breach of planning control and that they encourage vigorous enforcement action to stop or remedy unacceptable unauthorised development.
Earlier this year, consultants appointed by my Department completed a review of the effectiveness of the enforcement amendments in the 1991 Act and a copy of

their report is in the Library of the House. The consultants concluded:
This review of the use and effectiveness of the enforcement system indicates that the new and amended provisions introduced by the 1990/1991 Planning Acts are largely working well and that significant legislative change is not required".
That is generally reassuring. In the first instance, perhaps my hon. Friend should look to his local authority to take some of the hints and suggestions that have been made and be a little more forward in attacking the problem.
Nevertheless, my hon. Friend has related such a tale of horror that I shall look again at the matter to see whether we can learn anything from it. We shall keep the enforcement procedure under close review. I have considerable sympathy with my hon. Friend and I wish him well in his bid to rid his constituents of the difficulties that he has related to the House.

Question put and agreed to.

Adjourned accordingly at nineteen minutes past Ten o'clock.